Kingsway Search Xcelerator's 12th Acquisition
Asset-light plumbing services business with recurring revenues and leading market position
Purchase price of $5.625 million, plus a potential earn-out of up to $1.125 million, for a total maximum purchase price of $6.75 million
Unaudited pro-forma annual revenue of $4.0 million
Unaudited pro-forma annual adjusted EBITDA of $0.9 million
New credit facility to support growth at Kingsway Skilled Trades
CHICAGO, ILLINOIS / ACCESS Newswire / August 18, 2025 / (NYSE:KFS) Kingsway Financial Services Inc. ("Kingsway" or the "Company"), the only publicly-traded US company employing the Search Fund model to acquire and build great businesses, today announced the acquisition of Southside Plumbing, a leading provider of commercial and residential plumbing services located in Omaha, Nebraska. Southside Plumbing is the third business operated under the Kingsway Skilled Trades platform.
Southside Plumbing is one of the top commercial plumbing services company in the Omaha, Nebraska metropolitan service area. With decades of commitment to its community, Southside Plumbing has built an impressive reputation for both quality and reliability.
Southside Plumbing's customer base is split 70% commercial and 30% residential, and approximately 70% of trailing 12-month revenues are either recurring or reoccurring. Southside Plumbing's service and repair business exhibits a strong growth profile of c. +20% per year. Kingsway believes Southside Plumbing has the potential to accelerate growth via expanded marketing efforts and new service lines, and that Southside Plumbing can increase the proportion of sales that are recurring or reoccurring given healthy momentum in service and repair.
The transaction closed on August 14, 2025. The purchase price included $4.0 million cash at close, a $0.5 million seller note due in 2030, a potential earn-out of up to $1.125 million based on growth in adjusted EBITDA that is payable between 2026 and 2028 and contemplates a +75% increase in adjusted EBITDA relative to trailing 12-month EBITDA at close to achieve full pay-out, plus a retained 20% equity interest, for a total maximum purchase price of $6.75 million. Kingsway is also responsible for certain closing fees and expenses.
Rob Casper, President of Kingsway Skilled Trades, sourced and led the transaction for Kingsway.
Management Commentary
"I am thrilled to welcome Southside Plumbing as the third operating business under the Kingsway Skilled Trades platform," said JT Fitzgerald, Kingsway's President and CEO. "The Southside Plumbing team has an exceptional reputation in its market for quality and service, which has led to consistently robust growth in its service and repair business. Kingsway is excited to partner with Josh Gruhn, who will remain with the company as President and maintain an economic interest, and to uphold Southside Plumbing's legacy of excellence and reliability."
"Josh and his team at Southside Plumbing have built an outstanding plumbing business in the growing Omaha market," said Rob Casper, President of Kingsway Skilled Trades. "I am proud to partner with such a quality person and operator to continue growing Southside Plumbing in the years ahead."
"It's an exciting day for Southside Plumbing," said Josh Gruhn, Founder and President of Southside Plumbing. "Rob and his team at Kingsway are an ideal partner as we look to take Southside Plumbing to the next level. I am excited to help the business thrive in this new chapter."
New Credit Facility
In connection with today's announcement, Kingsway Skilled Trades has entered into a financing arrangement with Newburyport Five Cents Savings Bank ("Newburyport Bank") to support the growth of the Kingsway Skilled Trades platform.
The financing arrangement includes senior debt in the form of a commercial term loan at a fixed rate of 7.5% with a 7-year amortization schedule, plus access to both a commercial revolving line of credit and an equipment line of credit. The relationship between Newburyport Bank and Kingsway Skilled Trades may be expanded in the future to support additional acquisitions.
Further detail regarding the terms of the financing arrangement will be disclosed on a Form 8-K to be filed with the Securities and Exchange Commission.
About Southside Plumbing
Southside Plumbing is a leading provider of commercial and residential plumbing services in the Omaha, Nebraska metro area and surrounding communities. Founded by Josh Gruhn, a second-generation master plumber, the company is built on a legacy of hard work and a deep-rooted commitment to delivering reliable, high-quality plumbing services. Southside Plumbing is dedicated to providing unmatched customer care while ensuring the safety and comfort of the homes and businesses it serves.
About the Company
Kingsway Financial Services Inc. ("Kingsway") (NYSE: KFS) is the only publicly-traded US company employing the Search Fund model to acquire and build great businesses.
Kingsway owns and operates a collection of high-quality B2B and B2C services companies that are asset-light, growing, profitable, and that have recurring revenues. Kingsway seeks to compound long-term shareholder value on a per share basis via its decentralized management model, its talented team of operators, and its tax-advantaged corporate structure.
Forward-Looking Statements
This press release may include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. Words such as "expects," "believes," "anticipates," "intends," "estimates," "seeks," and variations and similar words and expressions are intended to identify such forward-looking statements; however, the absence of any such words does not mean that a statement is a not a forward-looking statement. Such forward-looking statements relate to future events or future performance, but reflect Kingsway management's current beliefs, based on information currently available. A number of factors could cause actual events, performance, or results to differ materially from the events, performance, and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the section entitled "Risk Factors" in the Company's 2024 Annual Report on Form 10-K and subsequent Form 10-Qs and Form 8-Ks filed with the Securities and Exchange Commission. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise.
Additional Information
Additional information about Kingsway, including a copy of its Annual Reports can be accessed on the EDGAR section of the U.S. Securities and Exchange Commission's website at www.sec.gov, on the Canadian Securities Administrators' website at www.sedar.com, or through the Company's website at www.kingsway-financial.com.
For Investor Inquiries:
Hayden IR
James Carbonara
(646) 755-7412
james@haydenir.com
For Company Inquiries:
Kingsway Financial Services Inc.
Kent Hansen, CFO
(312) 766-2163
khansen@kingsway-financial.com
SOURCE: Kingsway Financial Services, Inc.
View the original press release on ACCESS Newswire:
https://www.accessnewswire.com/newsroom/en/banking-and-financial-services/kingsway-announces-acquisition-of-southside-plumbing-1061910
