You've spent the better part of two or three decades building a business that actually works. Your team is certified, your maintenance contracts renew reliably, and your name carries weight in the industry. Now you're starting to think about what comes next, and you're not sure where to begin.
Selling a heating business in New Zealand isn't something most owners do more than once. The process is opaque, the buyer market isn't well understood, and the stakes are personal. This article is written for owners in that position: experienced, careful, and not yet sure they're ready to talk to a broker.
How buyers assess heating and mechanical services businesses
Buyers commonly separate the underlying demand for heating, ventilation, boiler, burner, and mechanical services from the commercial strength of the company providing them. Regulatory duties, installed equipment, and customer maintenance needs can support demand for a category of work, but they do not guarantee a particular provider's revenue or customer retention.
For work connected with specified systems and building compliance schedules, buyers may review the applicable Building Act requirements, inspection and maintenance responsibilities, customer contracts, service records, renewal and termination rights, margins, and qualification coverage. The legal duty belongs to the relevant building owner or responsible party. It should not be presented as contractually locked revenue for the service provider.
Registration, practising-licence, refrigerant, health and safety, and technical-competency requirements depend on the work performed. Map which people hold each required credential, its scope and expiry, and whether the business can continue relevant work if the owner or another key person leaves. Verify the current rules with the appropriate regulator and qualified advisers.
How a NZ heating business may be assessed
Buyers commonly examine normalised earnings when assessing a heating or mechanical services business, but there is no dependable sector-wide multiple. Contract quality, certification coverage, customer concentration, management depth, working capital, and deal terms can each materially affect value.
Recurring contract revenue. Documented maintenance and service agreements can improve confidence in future earnings. Buyers may examine termination rights, renewal history, concentration, margins, and whether the relationships depend on the owner.
Team depth and certification. Buyers can examine required registrations, practising licences, competency, tenure, employment terms, and key-person dependencies. Multiple appropriately qualified people can reduce transition risk, but the effect on value is transaction-specific.
Customer concentration. Buyers assess revenue and margin by customer, contract terms, relationship ownership, and the effect of losing or renegotiating material work. There is no universal concentration threshold or price adjustment.
Owner dependency. Centralised customer relationships, technical decisions, approvals, or estimating can create transition risk that a buyer may address through price, conditions, retained roles, or other terms.
Financial records. Prepare reliable accounts, current trading, working capital, debt, assets, capital expenditure, and support for proposed owner or one-off adjustments.
Buyer categories to compare
Trade buyers may seek customer relationships, regional coverage, people, assets, or adjacent capability. Some integrate acquisitions and others retain local operations. Ask for the actual plan and evidence from previous transactions.
Private equity and other financial sponsors use different fund structures, leverage, governance, investment periods, and transaction terms. A proposal may include an earn-out or retained equity, but no standard structure or hold period applies.
Permanent holding companies state that they acquire without a planned resale. PermaTech's stated model is permanent ownership, retained company identity, and decentralised operations. Sellers should still verify funding, governance, management and employee plans, and any material commitments for the proposed transaction.
PermaTech acquired Tubman Heating in 2024 under its permanent-ownership model. That single transaction demonstrates PermaTech's stated approach to that acquisition. It does not establish the terms or outcome of another seller's transaction.
What happens to your team and brand after the sale?
Employee, brand, and operating outcomes depend on the buyer, transaction structure, employment process, governance, and written terms. Do not infer those outcomes from a buyer category.
Ask every buyer what is proposed for the employing entity, roles, management authority, brand, locations, systems, customers, suppliers, and future ownership. Test the answers against incentives, decision rights, references, and transaction documents.
Plan confidentiality, privacy, employee communication, and counterparty contact with advisers. A confidentiality agreement does not replace employment, privacy, consultation, consent, or disclosure obligations.
When to start thinking about an exit
Business.govt.nz says a sound succession plan can take years. Start early enough to improve records, reduce owner dependency, address qualification coverage, and compare options without relying on a fixed preparation period or promised valuation outcome.
The first step is forming an evidence-based view of the business: what supports maintainable earnings, what investment and risk remain, what depends on the owner, and what transition the seller wants.
Questions to Ask Yourself Before You Do Anything
Before you engage anyone, broker, buyer, or advisor, work through this list honestly:
- What percentage of revenue comes from recurring maintenance contracts versus project or reactive work?
- What certifications does your team hold, and who else in the business could manage technical decisions if you stepped back?
- How concentrated is your customer base? Could the loss of your two or three largest clients meaningfully alter the business?
- Are your last three years of financials clean and normalised, or do they require explanation?
- What does your lease situation look like, do you own or rent premises, and when does the lease expire?
- Do any key employees know you're thinking about selling? What's your communication plan?
- What outcome do you actually want, for yourself, for your team, and for the business?
- What's your view on a role post-sale, are you open to staying on in a transition or advisory capacity, or do you want a clean exit?
The answers to these questions will shape every aspect of the process: your timeline, your buyer list, your negotiating position, and your eventual outcome.
If you've read this far, you're probably at the point where a conversation, confidential, no obligation, would be more useful than more reading. PermaTech works with NZ industrial and technical services businesses and is always willing to have that conversation on your terms, at your pace. There's no pressure and no process required to have an initial discussion.