Integrated Earthmoving Services & Heavy Equipment Company, Operated Rental Plus Equipment Sales

$25.2M

Revenue

$9.3M

SDE

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Full Editorial Writeup

This is a two-entity heavy civil operation built around large-scale earthmoving. Entity A provides operated heavy equipment rental and excavation support for major earthmoving projects across the United States, running a fleet of high-horsepower tractor and scraper combinations with experienced operators and in-house maintenance. Entity B sells new and used heavy equipment and provides parts and fabrication, giving the group both a services arm and a dealer/aftermarket arm that feed each other. The combined business generated roughly $25.2m in revenue and $9.3m in EBITDA, a ~37% EBITDA margin that is unusually high for this sector and points to real operating leverage in the owned fleet.

The demand engine is new construction, specifically the dirt-moving phase of large projects. Management calls out recent expansion into the Southeastern US and growing penetration of data centers and renewable energy (solar) sites, two of the most active capex categories in the country right now. Entity A reportedly generates business entirely through repeat customers and referrals, and has grown adjusted EBITDA at a 39.1% CAGR from 2023 to the TTM ending September 2026. Entity B has held a 25.2% average adjusted EBITDA margin from 2023 to 2025.

What makes this notable is the margin profile combined with capacity-constrained growth. The seller says the company passes on work because it cannot add fleet fast enough, historically adding only three to four tractor/scraper combos per year. For a buyer with capital, that is a straightforward lever: finance more iron, staff more crews, and convert turned-away demand into revenue. The flip side is that this is a cyclical, project-based business tied to construction capex, not a recurring-contract annuity.

Why we like it

Earnings quality is strong on the surface: $9.3m EBITDA on $25.2m revenue is a ~37% margin, which is high for heavy civil and implies the owned, operated fleet model captures both the equipment rental spread and the labor markup. The two-entity structure means some of that EBITDA comes from equipment sales and parts/fabrication, so the services margin and the dealer margin should be separated in diligence.
The moat is the fleet plus the operators. High-horsepower tractor/scraper packages are expensive, hard to source, and useless without skilled operators and in-house maintenance, so the combination of owned iron, trained crews, and a repair shop is genuinely hard to replicate quickly. Entity A winning entirely on repeat customers and referrals tells you the reputation and reliability are real.
Market tailwinds are as good as it gets for dirt work right now. Data centers and solar farms both require enormous earthmoving at the start of every project, and the company is already penetrating both while expanding into the Southeast. These are among the few construction end-markets with multi-year capex commitments behind them.
The operator advantage is obvious and quantified: the company turns away work because it cannot add fleet fast enough, historically limited to three or four tractor/scraper combos per year. A buyer with equipment financing can directly convert that passed-over demand into incremental revenue, which is a cleaner growth path than having to go find new customers.

How to improve it

Attack the self-identified capacity constraint immediately by lining up equipment financing or a sale-leaseback structure to add tractor/scraper combos faster than the historical three to four per year. The business is literally saying no to revenue it could otherwise book, so each incremental, utilized combo should carry clear contribution margin.
Formalize the geographic expansion into Texas and the Western US with a hub-and-crew playbook rather than ad hoc mobilization. Standardize how a new region is opened (equipment staging, local operator hiring, GC relationships) so expansion is repeatable instead of founder-dependent.
Build a real sales and marketing function targeting general contractors and project developers in data centers and solar, where procurement is more institutional. Entity A relying entirely on referrals is both a strength and a ceiling; a small outbound effort tied to known pipelines of announced projects could smooth revenue.
Tighten utilization tracking and bidding discipline across the fleet. Install telematics and job-level profitability reporting so you know which machines, operators, and project types actually earn, then reallocate iron toward the highest-margin earthmoving work and shed or sell underperforming units through Entity B.
Use Entity B's equipment sales and parts/fabrication arm more deliberately as a counter-cyclical hedge and a channel. In a construction slowdown, used-equipment sales and parts/service tend to hold up better than new project work, so treat that entity as both a margin source and a buffer rather than an afterthought.
Reduce key-man and operator concentration risk by documenting maintenance SOPs, cross-training operators, and building a bench. The scarce resource here is skilled operators as much as it is iron, so a retention and recruiting program protects the ability to actually deploy the fleet you finance.

Diligence notes

Separate the economics of the two entities completely. The headline $9.3m EBITDA blends operated rental services (Entity A) with equipment sales and parts/fabrication (Entity B); you need standalone revenue, margin, and working capital for each, because equipment sales revenue can be lumpy, lower quality, and inventory-intensive versus recurring project services.
Scrutinize the quality and sustainability of the margin. A ~37% blended EBITDA margin is high for heavy civil, so confirm how much is driven by adjustments, by gains on equipment sales, by favorable owned-vs-leased fleet accounting, and whether it normalizes once you account for replacement capex and operator wage inflation.
Dig into customer and project concentration behind the repeat-and-referral story. Understand how much revenue comes from the top handful of GCs and whether data center and solar exposure is concentrated in a few large developers, since the loss of one or two relationships could swing results materially.
Pin down the true maintenance capex and fleet age. Earthmoving equipment wears hard, and reported EBITDA means little without understanding the annual spend required just to keep the fleet running, the age and hours on key tractor/scraper units, and the cost to add capacity at current equipment prices.
Verify the cyclical exposure and backlog. This is project-based construction revenue with no recurring contracts, so review signed backlog, pipeline of awarded work, and how the business performed in prior slower construction periods before underwriting the 39.1% growth CAGR as durable.
Confirm the leased real estate terms and facility adequacy. Real estate is leased, so review lease length, renewal options, rate, and whether the maintenance shop and equipment yard can support the planned fleet expansion without a disruptive move.

Source

Originally listed on BizBuySell. View original listing →