38-Year Concrete & Asphalt Repair Contractor, Metro Detroit

$7.0M

Revenue

$2.7M

SDE

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Full Editorial Writeup

This is a 38-year-old concrete and asphalt repair contractor operating throughout Metro Detroit and Southeast Michigan, serving a mix of commercial, municipal, and residential customers. The company handles the full spectrum of pavement repair work: concrete pavement, sidewalks, driveways, curbs, structural concrete, joint sealing, drainage, and asphalt repairs. What separates it from a typical trade contractor is the substantial owned equipment fleet of 71 units carrying roughly $2.9 million in gross book cost, which eliminates dependence on rented equipment and lets the company execute jobs in-house on its own schedule.

The financial trajectory is the headline. Revenue grew 32.8% in the most recent completed fiscal year to $6.76 million, and the current year is accelerating: through just eight months, revenue of $6.98 million has already surpassed the entire prior full year. The business carries zero long-term debt, holds a strong cash position, and throws off $2.68 million in owner cash flow on that revenue, an unusually strong margin for a repair contractor. That combination of growth, cash conversion, and a clean balance sheet is rare in this trade.

The moat is a long-tenured, licensed workforce (17 full-time employees including multiple Journeyman-level operators averaging over 11 years of tenure) plus deep relationships across a diversified commercial, municipal, and residential base. Infrastructure funding at the federal and state level continues to support municipal pavement repair demand, giving the buyer a tailwind rather than a headwind. The owner is retiring, opening the door to an operator or roll-up buyer to inherit a proven crew, a paid-for fleet, and a book of repeat public and private work.

Why we like it

Earnings quality is exceptional for the trade: $2.68 million of cash flow on roughly $7 million of revenue is a ~38% owner margin, well above typical pavement contractors. The business is debt-free with a strong cash position, so nearly all of that cash flow is real and not servicing leverage.
The moat is a paid-for fleet plus a licensed crew that is hard to replicate quickly. Seventy-one units at ~$2.9 million gross book cost mean the buyer avoids rental dependency and can win and complete jobs on its own timeline, while 11-plus years average tenure and multiple Journeyman operators create execution reliability competitors cannot cheaply match.
Market tailwinds are genuine and durable, not hype. Federal and state infrastructure repair budgets continue flowing, and municipal pavement rehabilitation is non-discretionary spending that survives downturns. Repair and maintenance work is stickier than new construction because roads, sidewalks, and curbs degrade on a schedule regardless of the economy.
The operator advantage is that this is a clean handoff with real growth momentum: current-year revenue through eight months already exceeds the prior full year, implying a run rate above $10 million. A hands-on owner can inherit a functioning team and fleet and push into MDOT bidding and adjacent repair lines rather than fixing a broken business.

How to improve it

Formalize a municipal bidding function within the first 90 days to capture more MDOT and federally funded projects. Hire or assign a dedicated estimator to increase bid volume, since infrastructure budgets are flowing and the fleet capacity already exists to absorb more work.
Build recurring revenue streams by pursuing multi-year maintenance and joint-sealing contracts with municipalities and commercial property managers. Converting one-off repair jobs into scheduled preventive maintenance agreements would smooth revenue and make the business more valuable at exit.
Institutionalize the estimating and project management systems before the owner departs. Document the pricing logic, bid templates, and job-costing so tribal knowledge held by the retiring owner is not lost, which protects the margin that makes this deal attractive.
Expand the structural concrete, drainage, and joint sealing lines that carry higher margins than basic pavement patching. Cross-sell these services into the existing commercial and municipal base to raise revenue per customer without new customer acquisition costs.
Use the scale, fleet, and workforce as a roll-up platform to absorb smaller local competitors. Retiring solo contractors in Southeast Michigan can be acquired cheaply and folded onto the existing back office and equipment base for immediate margin accretion.
Negotiate a longer-term lease or purchase option on the yard and building before closing. The lease expires 01/01/2030 and rent is only $6,500 per month, so locking in favorable terms protects operations and removes a post-close risk.
Invest in fleet lifecycle planning and a preventive maintenance schedule for the 71 units. With $2.9 million of equipment, a disciplined replacement and upkeep program prevents capex surprises and keeps utilization high during peak paving season.

Diligence notes

Scrutinize the 32.8% revenue jump and the current-year surge to confirm it is durable, not a spike from one or two large municipal contracts. Ask for a customer and project concentration breakdown, since losing a single big municipal account could materially dent the run rate.
Verify the $2.68 million cash flow with tax returns and job-level profitability, and understand what add-backs are baked into SDE. Confirm how much of the margin depends on the owner's estimating, bidding, and relationships versus systems that transfer with the sale.
Assess workforce continuity given how much value sits in the crew. Confirm the Journeyman operators and long-tenured employees intend to stay post-close, check for union or prevailing-wage obligations on public work, and evaluate wage inflation risk in a tight trades labor market.
Inspect the equipment fleet in detail: age, condition, hours, and near-term replacement needs behind the $2.9 million gross book cost. Gross book cost overstates real value, so get an independent appraisal to understand actual replacement capex over the next few years.
Confirm the lease terms and landlord relationship, since the facility is not included and the lease expires in early 2030. Understand whether it can be assumed or renegotiated and whether relocation would disrupt the yard and equipment storage operations.
Review bonding capacity, licensing, and insurance, which are gating requirements for municipal and MDOT work. Confirm the company's surety relationships and whether they transfer or need to be re-established under new ownership, as this directly limits how much public work a buyer can bid.

Source

Originally listed on BizBuySell. View original listing →