EA-RS Fire Group in acquisition talks with four targets, interested in more candidates – MD

EA-RS Fire Group, a Rockpool Investments-backed fire protection systems provider based in the UK, is talking to four potential acquisition candidates to bolster its geographic presence, MD Mark Wheeler said.

The group, which Wheeler predicted would record around GBP 35M turnover this year, is interested in target dossiers about companies operating at GBP 3M to GBP 10M revenue, although it is capable of concluding transactions outside this range, he said.

EA-RS Fire Group is talking with UK- and Ireland-located industry counterparts focused on the housing, commercial, infrastructure and data center space, Wheeler said. It plans to have operational hubs with full training facilities throughout the UK and Ireland, to provide its countrywide clients with local teams, he added.

Management is hopeful of concluding at least two transactions before year-end, he said, following the purchase and integration of CCSS Fire & Security in February. EA-RS Fire Group has a strong acquisition pipeline aside from the four targets already in talks, and adds new candidates regularly.

EA-RS Fire Group has a dedicated M&A team scouting targets, and can also use the expertise of its Chairman Andrew Aylwin, who is also managing partner at MDW Capital Partners, Wheeler said.

The company’s key acquisition criteria include a target’s operations, location and access to large maintenance and major-project contracts, he said. He cited as an example its deal for CCSS, a Birmingham, West Midlands-located fire and security engineering company, and noted that EA-RS Fire Group has found strong acquisition opportunities among sub-10M turnover businesses.

The COVID-19 pandemic has resulted in a number of business owners in their early to mid-50s looking to sell as a retirement play or to become part of a larger, more secure group, Wheeler said.

The company would use working capital and funds from private equity backer Rockpool Investments to satisfy transaction payments, he said. Rockpool provided acquisition funding to EA-RS Fire Group in February, as reported. Rockpool provides equity and loan financing of between GBP 3M to GBP 12M to profitable UK-based private companies, and has invested more than GBP 475M since inception, the report adds.

EA-RS Fire Group now comprises EA-RS Fire Engineering, incorporated in 1996 which Wheeler forecast around GBP 19M turnover this year; CCSS Fire and Security which expects around GBP 12M revenue; and Circum Fire Engineering, a St. Albans, Hertfordshire based fire protection services specialist acquired in November 2019, which should record around GBP 4M turnover, he added.

Grant Thornton, HMT, Taylor Wessing and Mills & Reeve are among the advisory firms EA-RS Fire Group could use for future deal due diligence matters, dependent on the transaction size, workload and potential conflict of interests, he said.

It used Morgan LaRoche, Oracle Corporate Finance and Grant Thornton on the Rockpool investment, and Wheeler said HMT advised on the CCSS deal, with Beyond The Deal and Rathbone Results providing integration and management support. EA-RS Fire Group’s management team is also involved in deal due diligence matters, he added.

With headquarters in Witham, Essex, EA-RS Fire Group also has ‘Centre of Excellence’ offices in St. Albans, Birmingham and Manchester. Providing clients in the commercial, critical infrastructure and social housing sectors with the design, supply, installation and maintenance of fire-detection, fire-alarm, gas-suppression, watermist, sprinkler and security systems.

Group companies hold a range of third-party accreditations, such as approvals from the Loss Prevention Certification Board, LPCB which works with the industry and government to set the standards that fire and security products and services perform effectively.

by Lloyd Vassell