Stout provided financial and tax due diligence in support of a series of acquisitions executed by a private equity-backed environmental services platform over a multi-year roll-up strategy. The platform operates in vacuum excavation, hydro-excavation, and pipeline inspection sectors, and these acquisitions led to service footprint and geographical expansions across the United States. The acquisitions were for three lower middle-market businesses that were founder led or first-generation PE-backed.

Our work included quality-of-earnings analyses, working capital, and indebtedness procedures. The focus areas across the deal included revenue recognition on key larger projects, headcount normalizations, cash-to-accrual adjustments, owner compensation, backlog, headcount trends, and more. We also tailored the deliverable to apply synergies to align with the platform’s operating leverage and to further streamline integration efforts by mapping to the platform’s chart of accounts and more.

In each transaction, we helped inform valuation, deal structuring, and integration efforts. Our team performed financial and tax diligence along with post-transaction valuation and PPA.