Xebec Adsorption's (Xebec) wholly-owned subsidiary, Xebec Holding USA, has agreed to acquire all the outstanding securities of Enerphase Industrial Solutions (Air Flow) to support its renewable natural gas (RNG) growth.
Air Flow is a distributor and service provider of compressed air equipment in North Carolina. Established in 1981, the firm’s focus is on preventative maintenance solutions, air energy system audits and analysis, as well as machine rentals, parts and service.
Air Flow’s principals will remain with the company following the acquisition, to optimise its integration into Xebec’s industrial service and support business and to grow the operation.
The total consideration payable by Xebec is around $6 million (€3.83 million), subject to certain holdbacks, adjustments, and time-based payments. Air Flow had revenues of around $10.1 million (€6.45 million) for the fiscal year ending 31 December 2019, and revenues are estimated to grow organically to $11.5 million (€7.35 million) this year, with an EBITDA margin of around 10%.
B Stanton Shelton III, president and CEO of Air Flow, said: “When Xebec approached us, we saw a unique opportunity to be part of a mission that was larger than us.
“Climate change is a growing concern and I saw how our team and experience in compressed air service could translate into being a strong value add to help service and support Xebec’s upcoming RNG and hydrogen systems.
“North Carolina is one of the top 10 agriculture producing states, which represents significant potential for RNG projects. Air Flow is well-positioned with three points of presence to offer truly local support to future dairy and hog farmers, municipalities, and industry.”
“As RNG and hydrogen adoption continues, the need to support customers over the lifetime of their installations grows,” commented Dr Prabhu Rao, COO of Xebec. “Air Flow is yet another example of an acquisition that is immediately accretive to Xebec’s earnings and the service team at Air Flow can be trained to also work with renewable gases.
“Growing our service footprint is key to Xebec’s strategy to sell more Cleantech systems, better support our customers and capture more aftermarket business. I’m happy to see the continued execution by our team and we expect several more acquisitions throughout the rest of the year.”