How to Sell Your Electrical Contracting Business
Who's buying, what they pay at your size, and what makes an electrical contractor harder to sell than it looks.
Electrical contractors are selling for 2.5x to 4x SDE under about $500K in earnings, and 5.5x to 8x EBITDA above $1M, with data-center and mission-critical specialists clearing 8x or more. The buyers paying the top of those ranges are PE-backed platforms and their add-on arms, and they are more active in 2026 than at any point I've seen. A sale takes six to nine months from first call to close, and the single biggest thing that slows it down is a license qualifier who is also the owner.
The Electrical Contracting Market for Sellers
Under about $500K SDE, your buyers are individuals using SBA 7(a) financing, a journeyman or project manager ready to own something, and local competitors looking to pick up your crews and customer list. Pricing is 2.5x to 4x SDE. Deals are mostly cash at close with an SBA lender, a 10% seller note is common, and the buyer will almost always need you for a defined transition. The qualifier question decides whether this sale is clean or messy.
At $500K to $1M EBITDA you reach the add-on buyers: an existing PE-backed electrical or mechanical platform that already has a footprint in your region and wants your crews, your GC relationships and your service agreements. Pricing moves to 4x to 6x EBITDA and the structure changes with it: expect a portion of the price in an earnout or in rollover equity in the platform. The buyer brings its own license, bonding and back office, so your deal moves faster than a first-time buyer's.
"The Richmond contractor had $2.8M of EBITDA and a growing book of data-center work. Based on trade averages the owner expected about 6.5x. It closed at 8.4x, because two platform buyers were each short on qualified electricians in exactly the market where the data-center build-out was happening. They were buying the workforce as much as the company. The lesson isn't 'get into data centers.' It's that the multiple is set by what the buyer can't get elsewhere."
Above $1M EBITDA, platforms and strategics compete, and the multiple is set by what kind of electrical work you do. Commercial and industrial service with recurring maintenance contracts gets 5.5x to 8x. Data-center, healthcare and mission-critical work gets bid higher, because the buyer is paying for a qualified workforce in a market where they can't hire one. The Richmond deal below is the clearest example I have. For the specific buyers active right now, with names, see Who's Buying Electrical Contractors in 2026.
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What's changed for Electrical Contracting sellers in 2026
What's driving buyer activity for electrical contracting businesses right now.
PE platforms are the top bidder
PE-backed electrical and mechanical platforms and their add-on arms are paying the top of every range and are more active in 2026 than in any prior year.
Data-center and mission-critical work resets the multiple
Shops with data-center, healthcare or industrial work are trading above 8x EBITDA because buyers are paying for a workforce they can't hire.
The qualifier shortage is a seller's advantage
Buyers short of licensed master electricians will pay for a shop that comes with a second qualifier already on payroll.
Three buyer markets, three prices
Under $500K SDE sells to individuals and competitors at 2.5x–4x SDE; $500K–$1M EBITDA to add-on buyers at 4x–6x; $1M+ to platforms at 5.5x–8x. Earnings, not revenue, decide which one you're in.
What Buyers Look for in an Electrical Contracting Business
Understanding these value drivers can help you prepare your business and command a higher multiple.
The license qualifier
The firm's license is backed by one licensed individual. If that's you, the buyer can't operate the day after closing without a plan: a second qualifier already on payroll, you staying on as qualifier under an employment agreement for 12–24 months, or a platform buyer bringing its own. Individuals usually can't.
Backlog and work in progress
Buyers pay for signed, unstarted work and the margin left in jobs under way. You'll hand over a WIP schedule: contract value, cost to date, cost to complete, billed to date, over- and under-billings. If it doesn't tie to the P&L, the price gets retraded in diligence.
Retainage and the working-capital peg
On commercial work, 5–10% of what you've earned sits in retainage for months. The buyer sets a normalized working-capital target at signing, and at close the price moves by the difference. Know your trailing-twelve-month working capital before you set a price.
Bonding capacity
Your surety underwrote you and your personal guarantee. A stock buyer inherits the line only if the surety agrees; an asset buyer starts over. Platforms carry their own program. For an SBA buyer, a bonded commercial book can be the deal-killer, so know whether your work truly requires bonds.
Safety record (EMR)
Your experience modification rate goes straight into the buyer's model. Above 1.0, workers' comp costs more and some GCs won't prequalify you; buyers price both in. Three clean years before a sale is worth real money.
Customer concentration and union status
Two or three GCs making up most of revenue is the most common electrical-contractor problem. Buyers can't meet them before close, so the fix is paper: master agreements, documented bid history, renewing service contracts. IBEW shops have a narrower buyer pool and a different diligence path on the pension side.
How selling your electrical contracting business runs
Typically 6-9 months from first call to closing. Here is where the time goes and where electrical contracting deals stall.
The number and the story
We recast your financials (add-backs, owner compensation, one-time costs), build the WIP schedule into a form a buyer will trust, and settle on a range. I tell you plainly which of the three buyer markets you're in. If the answer is 'not yet,' you get the fix list instead of a listing.
Month 1The quiet market
Electrical sells best through a targeted process, not a public listing. I approach the platforms, strategics and qualified individuals who fit your size, under NDA, with a blind profile that doesn't name you. You'll meet the three or four buyers worth meeting.
Months 2–3Offers and the LOI
Offers come as letters of intent. Price is only part of it: cash at close versus earnout, rollover, how the working-capital peg is set, what happens to your bonding, and what they want from you after closing. We negotiate structure as hard as price, then sign one LOI with exclusivity.
Month 4Due diligence
This is where electrical deals stall. The buyer's accountants rebuild your WIP and over/under-billings; their counsel checks the license, permits, EMR history and contract assignment clauses; their insurance people review claims. The qualifier plan gets finalized here. If the WIP ties out, this is the boring part.
Months 5–7Close and transition
Purchase agreement, your employment or consulting agreement, qualifier filing with the Board, surety and insurance transfers, customer and employee announcements timed to the day. Then the transition you agreed to, usually 6 to 24 months depending on the buyer.
Months 7–9
Where electrical contracting deals stall
Knowing these early lets you fix them before they cost you money at closing.
Owner is the only qualifier
The buyer can't operate on day one. Fix: a second qualifier on payroll, or an employment agreement keeping you as qualifier for 12–24 months.
WIP schedule doesn't tie out
If over/under-billings don't reconcile to the P&L, the buyer's accountants retrade the price in month five. Fix: clean monthly WIP for twelve months before going to market.
Working-capital peg gives price back
Retainage and lean receivables mean the peg moves against you at close. Fix: know your trailing-twelve-month working capital before setting a price.
Two or three GCs are most of revenue
Buyers can't meet them before close. Fix: master service agreements, documented bid history, renewing maintenance contracts.
What to fix in the 12 months before you sell
- *Get a second qualifier.** Pay for a master electrician's exam prep and licensing now. It's the cheapest multiple-raiser on this list.
- Clean the WIP schedule every month. A buyer who can reconcile twelve consecutive months of WIP to your P&L trusts everything else you show them.
- Paper your GC relationships. Master service agreements, documented bid-win history, renewal terms on maintenance contracts.
- Push your EMR down. Safety program, documented toolbox talks, return-to-work policy. Three clean years.
- Get yourself out of the field. Estimating, project management and the key GC relationships need names other than yours on them.
- Separate personal from business. Trucks, phones, the family member on payroll, the shop building if you own it.
- Decide what you want after closing. A platform wants you for 12–24 months; an individual wants 90 days and a phone number. Knowing your answer narrows the buyer list.
Questions electrical contracting owners ask first
I'm the only qualifier. Can I still sell?
Yes, but it shapes who can buy and how long you stay. Start the second-qualifier process now, whether or not you sell this year; it's the cheapest multiple-raiser there is.
Do I need audited financials?
No. Reviewed or clean tax-return-based financials with a WIP schedule that ties out are enough for most buyers under $5M EBITDA. Above that, a quality-of-earnings report from the buyer's side is standard, and they pay for it.
Will I have to stay on after closing?
Almost always, for something between 90 days and two years. Individuals need less of you; platforms want more and will pay you for it.
How do you keep the sale confidential?
Blind profile, NDA before any name is shared, no public listing, and buyer meetings off-site. Employees and GCs learn about the sale when you decide, after closing.
What do you charge?
I charge 6% of the sale price on businesses up to $5 million, with no retainer and no upfront fees. Above that, the rate steps down. You pay when you're paid: most of the fee comes at closing, and if part of your price is a seller note or a deferred payment, my share of that part is paid when you receive it, not before. Our interests are fully aligned.
What's my electrical business worth?
Run your numbers in the calculator below for a starting range. It isn't a valuation; it's where the conversation starts.
How long does it take to sell an electrical contractor?
Six to nine months from first call to close. Month one is the number and the story, months two to three the quiet market, month four the LOI, months five to seven diligence, then close and transition.
Thinking about selling your electrical contracting business?
John Salony is an Accredited Business Intermediary who represents owners of privately held companies in confidential sales. The first conversation is confidential, free, and takes about 15 minutes.
Schedule a confidential conversationEmail john@johnsalony.com
