Limbach acquires Pioneer Power for $66.1 million to expand midwest presence

WARRENDALE, Pa. - Limbach Holdings, Inc. (NASDAQ:LMB), which has delivered an impressive 155% return over the past year according to InvestingPro data, has acquired Pioneer Power, Inc. for $66.1 million, strengthening its mechanical and maintenance solutions business in the Upper Midwest, according to a company press release.

The acquisition was financed through a combination of available cash and borrowings under Limbach’s recently expanded revolving credit facility, which has been increased from $50 million to $100 million through an amendment with lender Wheaton Bank & Trust Company.

Founded in 1947 and formerly 100% ESOP-owned, Pioneer Power provides industrial and institutional mechanical solutions to healthcare, food, power/utility, and oil refining markets in the Greater Twin Cities region and Upper Midwest. The company specializes in industrial piping, HVAC, plumbing, and maintenance services.

Limbach expects Pioneer Power to contribute approximately $120 million in annual revenue and $10 million in adjusted EBITDA beginning in 2026, adding to its current annual revenue of $532.91M and EBITDA of $56.83M. The company plans to provide an updated financial outlook for fiscal 2025 when it reports second quarter results in August. Investors seeking deeper insights into Limbach’s valuation and growth prospects can access detailed financial analysis through InvestingPro’s exclusive research reports.

The purchase price includes owned real property associated with Pioneer Power’s headquarters, warehouse, and fabrication facility valued at approximately $4.6 million, and is subject to customary working capital adjustments.

"This acquisition further expands our footprint in the core Midwest region and extends our reach into new geographic markets in the Upper Midwest," said Michael McCann, President and Chief Executive Officer of Limbach. "Since Pioneer Power generates the majority of its revenue through Owner Direct Relationships, primarily through time and materials contracts and small capital project work, it aligns well with our strategic shift."

Limbach Holdings provides building systems solutions for owners and facilities managers with mission-critical mechanical, electrical, and plumbing infrastructure across six vertical markets, including healthcare and data centers.

In other recent news, Limbach Holdings reported impressive financial results for the first quarter of 2025, significantly exceeding market expectations. The company achieved earnings per share of $1.12, compared to the anticipated $0.43, and generated revenue of $133.1 million, surpassing the forecast of $120.48 million. This performance was driven by strong outcomes in its Owner Direct Revenue (ODR) segment, which grew by 22% year-over-year, despite a 5% decline in General Contractor Revenue (GCR). Limbach’s adjusted EBITDA reached $15 million, outperforming the consensus projection of $10 million, with an adjusted EBITDA margin of 11.2%, marking a notable improvement from the previous year.

Additionally, Stifel analysts maintained their Buy rating for Limbach Holdings, setting a price target of $103.00, reflecting optimism about the company’s strategic initiatives and growth potential. These analysts highlighted the potential for further margin expansion due to an increased mix of On-Demand Repair services and improved SG&A leverage. Limbach’s total backlog also increased by 15%, driven by a 57% rise in ODR, although GCR experienced a 26% decline.

In corporate governance news, Limbach’s shareholders approved several key decisions during the annual meeting, including the election of directors and amendments to the company’s Omnibus Incentive Plan. This plan now includes provisions for accelerated vesting of stock units under specific circumstances. Furthermore, the appointment of Crowe LLP as the independent registered public accounting firm for the fiscal year 2025 was ratified. These developments underscore Limbach Holdings’ strategic focus on enhancing shareholder value and operational efficiency.

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