Heat Pump & Decarbonisation M&A Valuation Guide 2026

Published August 2026 · refreshed quarterly. Next scheduled review: November 2026.

The heat pump and decarbonisation sector in the UK is experiencing unprecedented policy-driven growth, balanced against significant execution and compliance risks. With the UK government's Warm Homes Plan targeting 450,000 heat pump installations annually by 2030, and £15 billion in public investment committed [1], the sector has moved from a niche environmental play to a core infrastructure requirement.

However, for business owners considering an exit in 2026, the valuation landscape is sharply divided. Acquirers are paying premium multiples for scale, compliance, and commercial exposure, while heavily discounting or avoiding businesses exposed to domestic retrofit grant cliffs or poor installation quality.

This guide details exactly how acquirers value heat pump and decarbonisation businesses in 2026, the EBITDA multiples they pay, and the deal-killers that destroy value.

Contents

1. The Heat Pump & Decarbonisation EBITDA Ladder
2. The Thirty-Factor Valuation Framework
3. Regulatory Economics: Certification, Grants and Compliance Costs
4. The Three Segments That Never Blend
5. Worked Examples: Two Full Valuations
6. Verified UK M&A Transactions (2025 to 2026)
7. The US Market Context: Absorbed into HVAC
8. Deal Structure: How the Consideration is Paid
9. The 5 Deal-Killers
10. The Diligence Question Bank
11. The 12-Month Preparation Timeline
12. Conclusion: Maximising Value in 2026
13. Frequently Asked Questions
14. Glossary
15. References
16. Related Valuation Guides

1. The Heat Pump & Decarbonisation EBITDA Ladder

Acquirers value heat pump and decarbonisation businesses based on scale, revenue predictability, and the quality of the customer base. The market is highly fragmented, and multiples expand significantly as a business crosses key EBITDA thresholds.

Note: The multiples below are based on verified UK and US transactions, published M&A data, and active buyer mandates in 2025 to 2026. For owner-managed businesses, Seller's Discretionary Earnings (SDE) is often used in place of EBITDA.

The Recurring Revenue Premium

In the building services and HVAC sector, revenue quality is the single biggest driver of multiple expansion within a given band.

Acquirers will pay a 1.0x to 2.5x EBITDA premium for businesses where maintenance plan revenue exceeds 50% of total revenue [2]. Recurring revenue from service and maintenance contracts provides predictable cash flow and insulates the business from the volatility of project-based installation work or government grant cycles. A business with £2m EBITDA heavily weighted toward commercial maintenance will command a significantly higher multiple than a £2m EBITDA business reliant on domestic Boiler Upgrade Scheme installations.

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2. The Thirty-Factor Valuation Framework

Two heat pump businesses reporting identical EBITDA can trade at materially different multiples. The gap is explained by thirty specific factors that acquirers score during due diligence, grouped into five categories. Owners preparing for a sale should benchmark their business against each factor at least twelve months before going to market, using the 12-month preparation timeline below as a working plan.

Financial (factors 1 to 6)

Operational (factors 7 to 12)

Regulatory and accreditation (factors 13 to 18)

Market and commercial (factors 19 to 24)

Strategic and exit (factors 25 to 30)

Summed across all thirty factors, a maximum score of 150 maps broadly onto the EBITDA ladder above: businesses scoring below 80 sit toward the bottom of their size band, businesses scoring 80 to 110 sit mid-band, and businesses scoring above 110 command the top of the range or a premium beyond it. The worked examples below apply this scoring directly to two sample businesses. Owners can use the free valuation calculator as a starting point before commissioning a full assessment.

3. Regulatory Economics: Certification, Grants and Compliance Costs

Compliance and grant infrastructure are not background considerations in heat pump M&A: they are the commercial moat. A buyer's first due diligence question is almost always whether the target can legally and commercially continue to access the Boiler Upgrade Scheme and the accreditation ecosystem beneath it. This section sets out the certification and grant economics that underpin the thirty-factor framework above.

MCS certification (Microgeneration Certification Scheme)

Initial MCS certification costs £1,500 to £3,000 and includes an assessment visit, documentation review, and a witnessed installation. Annual renewal costs £570 plus VAT, and the MCS Certification Fund covers 75% of fees up to £1,000 for new installers, materially reducing the cost of scaling a certified workforce. Certification typically takes four to six weeks to obtain following inspection.

The commercial consequence of a lapsed certificate is severe: a business cannot access Boiler Upgrade Scheme grants, cannot issue MCS certificates, and cannot be listed on the MCS installer directory, which for most residential installers is the primary lead source. Buyers reviewing due diligence will check the certification expiry date, any recorded non-conformances, and the ratio of certified installers to total workforce. Full detail on the certification process is available directly from MCS Certified.

TrustMark registration

TrustMark registration costs approximately £350 plus VAT annually and has been a requirement for Boiler Upgrade Scheme eligibility since April 2023, alongside providing consumer protection through the TrustMark guarantee. Without TrustMark, grants cannot be processed even where a business holds full MCS certification. Registration requirements are published by TrustMark.

PAS 2035/2030 (retrofit standards)

PAS 2030, the installer standard, is included within MCS certification for heat pump work. PAS 2035, the retrofit coordinator qualification, is a separate credential costing £2,000 to £4,000 in training per person, and is required for social housing retrofit schemes, ECO4, the Great British Insulation Scheme, and Warm Homes Plan local authority contracts. Businesses with an in-house PAS 2035 coordinator, able to self-certify retrofit projects rather than outsourcing coordination, command a 0.5x to 1.0x EBITDA premium at exit because they can bid directly for publicly funded retrofit work without third-party dependency.

FGAS certification (F-Gas Regulation)

Anyone handling refrigerants in heat pump systems, covering all ASHP and GSHP work, must hold FGAS certification. Individual technician certification (City & Guilds 2079) costs £300 to £600, and company certification costs £500 to £1,000 annually. Non-compliance is a criminal offence carrying an unlimited fine and HSE enforcement risk. Buyers will verify that every installer handling refrigerant holds an individual, current FGAS certificate as a non-negotiable condition of proceeding.

Boiler Upgrade Scheme grant economics

The Boiler Upgrade Scheme currently pays £7,500 per air source heat pump installation, rising to £9,000 for homes replacing oil or LPG heating from 2026. The scheme's budget for 2026/27 is £625 million, up from £295 million in 2025/26, a sign of continued policy commitment despite the wider grant volatility discussed in the deal-killers section below. Installers must hold both MCS certification and TrustMark registration to process claims; the installer applies on the homeowner's behalf, and the grant is paid direct to the installer on completion.

This grant creates a £7,500 to £9,000 price advantage over non-eligible competitors, arguably the single biggest commercial moat in residential heat pump installation. Buyers will check the BUS application approval rate, which should sit at 95% or above, and confirm there are no outstanding DESNZ flags or audits against the business. Official uptake data is published by GOV.UK and analysed independently by Nesta.

Gas Safe registration for hybrid systems

Hybrid installations, combining a heat pump with an existing gas system, require Gas Safe registration in addition to MCS. Annual fees are £445 for a sole trader plus £166 per additional operative. Without Gas Safe registration, a business cannot install hybrid systems, which removes roughly 30% of the addressable market from its reach.

The table below summarises the certification stack and its commercial impact.

4. The Three Segments That Never Blend

Acquirers view the decarbonisation market through three distinct lenses. A common mistake owners make is presenting their business as a blended entity. Buyers will disaggregate your revenue into these three segments and apply different risk profiles to each.

A. Domestic Retrofit (The Policy Play)

This segment relies on government grants (for example, the Boiler Upgrade Scheme) and consumer willingness to upgrade existing homes.

• The Upside: Massive total addressable market; high volume potential.
• The Risk: Extreme policy risk. Demand is highly sensitive to grant availability, energy price caps, and consumer sentiment. Acquirers view this revenue as volatile and lower quality.

B. Commercial & Public Sector (The Infrastructure Play)

This involves large-scale installations for social housing, commercial buildings, and district heat networks.

• The Upside: Long-term contracts, higher margins, and driven by strict ESG mandates and regulations (for example, the Future Homes Standard [3]).
• The Risk: Lumpy revenue, complex procurement cycles, and significant working capital requirements.

C. Service & Maintenance (The Annuity Play)

This is the ongoing servicing, repair, and compliance checking of installed systems.

• The Upside: Highly predictable, recurring revenue. This is the most valuable revenue stream to an acquirer.
• The Risk: Requires a dense, localised engineering workforce and sophisticated dispatch software to maintain margins.

5. Worked Examples: Two Full Valuations

The thirty-factor framework is only useful if it can be applied to real numbers. The two worked examples below show the full arithmetic from thirty-factor score through to enterprise value and deal structure, using the deal structure conventions set out later in this guide.

Example A: GreenHeat Installations Ltd, a residential-only ASHP installer

GreenHeat generates £3.2m of revenue and £420k of EBITDA, a 13.1% margin. The business is MCS certified, employs 6 installers, holds Daikin approved status, and processes a high volume of Boiler Upgrade Scheme applications. It has no maintenance contracts, the owner still designs 40% of systems personally, the forward order book runs to 8 weeks, and there are no social housing contracts.

Scored against the thirty-factor framework, GreenHeat achieves 78 out of 150, placing it in the 4.0x to 5.0x EBITDA band on the ladder.

Deal structure: 70% cash at completion (£1.34m), 15% deferred over 12 months (£287k), and 15% earn-out tied to 85% customer retention (£287k). The owner-dependency discount and the deferred/earn-out weighting both reflect GreenHeat's reliance on the owner for system design, a factor the 12-month timeline specifically addresses.

Example B: ThermoTech Energy Solutions, a commercial and residential business with maintenance contracts

ThermoTech generates £8.4m of revenue and £1.1m of EBITDA, also a 13.1% margin, but the composition of that margin is materially different. The business holds MCS, TrustMark, and an in-house PAS 2035 coordinator, employs 14 installers with an average age of 34, and holds approved installer status with Mitsubishi and Vaillant. It runs 3 local authority retrofit contracts and 420 annual maintenance plans generating £380k of recurring revenue, has a full management team with the owner in a strategic-only role, runs a Simpro CRM, and carries a 16-week forward order book.

Scored against the thirty-factor framework, ThermoTech achieves 121 out of 150, placing it in the 6.5x to 8.0x EBITDA band.

Deal structure: 60% cash at completion (£5.11m), 20% loan notes over 24 months (£1.70m), and 20% equity rollover into the buyer's platform (£1.70m). The equity rollover component reflects a PE-backed platform buyer, consistent with the £5m to £15m band in the deal structure table below.

The gap between these two businesses, 3.1x EBITDA higher for ThermoTech despite an identical margin, is explained entirely by recurring revenue, management depth, and public-sector contract exposure: exactly the factors weighted most heavily in the thirty-factor framework.

6. Verified UK M&A Transactions (2025 to 2026)

The UK market has seen active consolidation from private equity platforms, utility companies, and listed strategics acquiring scale and capabilities.

Note: Sureserve itself was taken private by Cap10 in July 2023 for an equity value of £214.1m, with adjusted EBITDA for continuing operations of £25.6m, implying an approximate 8.4x EV/EBITDA multiple for a national leader.

7. The US Market Context: Absorbed into HVAC

Unlike the UK, the US does not have a distinct, standalone "heat pump installer" buyer universe. In the US, heat pump installation is entirely absorbed into the broader HVAC (heating, ventilation, and air conditioning) and insulation roll-up market.

Private equity platforms like Sila Services (backed by Morgan Stanley Capital Partners) and public consolidators like Comfort Systems USA (NYSE: FIX) and Installed Building Products (NYSE: IBP) acquire HVAC businesses where heat pumps are simply one technology within a broader mechanical services offering.

The ceiling for the US building products and insulation market was set in July 2026 when QXO Inc acquired TopBuild Corp for $17 billion, representing a 14.9x pre-synergy EV/EBITDA multiple [10]. However, this reflects a massive national distributor and installer, not a pure-play heat pump business. UK sellers should not look to US HVAC multiples as a direct read-across for a UK domestic heat pump installer.

8. Deal Structure: How the Consideration is Paid

Headline enterprise value is only half the picture: how that value is paid, and on what conditions, materially affects the cash an owner actually receives on completion. Heat pump transactions in 2025 and 2026 follow a consistent pattern that scales with deal size.

Earn-out triggers specific to heat pump businesses

Earn-outs in this sector are rarely tied to generic EBITDA targets alone. They typically reference the specific operational and regulatory levers that drive the business:

• MCS certification retention. If certification lapses during the earn-out period, the earn-out is forfeited.
• Installer retention. Named individuals, often the certified installers who carry the accreditation, must remain in post for 12 or more months.
• BUS grant volume maintenance. A minimum number of Boiler Upgrade Scheme installations must be sustained per quarter.
• Local authority/social housing contract renewal. Retention of publicly funded contract relationships through the earn-out window.
• Maintenance plan customer retention. Typically set at an 85% or higher threshold, directly mirroring the recurring revenue premium discussed under the three segments.

Deferred consideration protections

Buyers typically build specific protections into deferred tranches rather than relying on a simple time delay:

• Warranty callback provisions. If callbacks exceed 5% in year one, deferred payments are reduced pro rata.
• MCS audit pass. The deferred tranche is made conditional on passing the annual MCS audit.
• FGAS compliance. Any refrigerant handling breach triggers a holdback of the deferred amount.

Owners preparing for exit should assume that a material share of consideration will sit behind these mechanisms rather than being paid in cash at completion, and should structure their 12-month preparation accordingly, particularly around certification renewal dates and installer retention planning. For a confidential view of how a specific business might be structured, book a valuation call.

9. The 5 Deal-Killers (Risks That Destroy Value)

Acquirers are actively hunting for scale in the decarbonisation sector, but they are hyper-sensitive to compliance and policy risks. The following five issues will kill a deal or severely degrade your valuation.

1. The Insulation Quality Scandal (The Ultimate Deal-Killer)

The single biggest risk in the UK retrofit market today is historical installation quality. In January 2026, the Public Accounts Committee published a devastating report revealing that 98% of external wall insulation (approximately 22,000 to 23,000 homes) and 29% of internal wall insulation installed under the ECO scheme up to mid-January 2025 had defects requiring remediation [11].

TrustMark suspended 38 installers, representing 81% of the external wall insulation market [11]. Remediation costs range from £250 to £18,000 per home, with worst-case scenarios exceeding £250,000 [11]. If your business has exposure to ECO-funded external wall insulation without bulletproof quality assurance and independent sign-off, acquirers will walk away due to the unquantifiable liability risk.

2. The Policy Cliff Edge

Acquirers discount revenue that relies on government grants with looming expiration dates.

• The Great British Insulation Scheme (GBIS) ended on 31 March 2026 [12].
• The ECO4 scheme has been extended, but only to 31 December 2026 [13].
• In the US, Section 25C and 25D tax credits were terminated for property placed in service after 31 December 2025 [14].

If your EBITDA is artificially inflated by a grant scheme that is ending, buyers will normalise your earnings downward.

3. Lack of MCS Certification and Compliance

To access the Boiler Upgrade Scheme (£7,500 standard grant, or £9,000 for off-gas-grid properties until March 2027 [15]), installations must be MCS certified. Over 60,000 MCS certified heat pump installations occurred in 2025 [16]. A business lacking rigorous internal compliance, PAS 2035 adherence [17], and MCS certification is unsellable to a strategic buyer.

4. The Workforce Bottleneck

The UK has an estimated 4,000 to 10,000 trained heat pump installers, but requires roughly 33,700 to meet government targets [18]. Acquirers are buying businesses largely to acquire skilled engineers. If your business suffers from high engineer churn, relies heavily on sub-contractors, or lacks an internal training academy, your valuation will suffer.

5. Blended Margins Without Visibility

If an acquirer cannot easily separate your high-margin commercial maintenance revenue from your low-margin domestic retrofit revenue, they will apply the lowest multiple to the entire business. Poor financial hygiene and inability to track profitability by segment or project is a major red flag during due diligence.

10. The Diligence Question Bank

Buyers and their advisers run a structured diligence process on any heat pump or decarbonisation business. Owners who prepare answers to the following twenty-five questions in advance, ideally as part of the 12-month preparation timeline below, materially shorten the process and reduce the scope for late-stage price chips.

Financial

1. Provide a month-by-month installation volume and revenue breakdown for the last 36 months. What is the seasonal pattern, and how dependent is first-quarter revenue on Boiler Upgrade Scheme processing timelines?
2. What percentage of revenue comes from BUS-funded installations versus private-pay, social housing/local authority contracts, and commercial work? How has this mix changed over three years?
3. What is the average job margin by type (ASHP residential, GSHP, commercial, hybrid), after labour, materials, and subcontractor costs?
4. What is the maintenance/service plan revenue: number of active plans, average annual fee, retention rate, and margin on service work?
5. What is the warranty callback cost per installation over 24 months, covering parts, labour, and any manufacturer recoveries?

Operational

1. List every MCS-certified installer by name, certification number, expiry date, and FGAS certification status. Which are employees and which are subcontractors?
2. What is the current forward order book in weeks, and what is the conversion rate from survey to signed order?
3. What CRM or job management system is used? Can a full job history be exported with margins, timelines, and customer satisfaction scores?
4. What manufacturer training certifications does the team hold (Mitsubishi, Daikin, Vaillant, Samsung, Nibe and similar), and which of these grant warranty sign-off authority?
5. What is the average time from customer enquiry to completed installation, and how does this compare with 12 months ago?

Regulatory

1. Provide the MCS certificate, the most recent audit report, and any non-conformance notices for the past three years. When is the next audit due?
2. Provide TrustMark registration confirmation and any consumer complaints or guarantee claims in the last 24 months.
3. Provide the FGAS company certificate and individual technician certificates. Have any refrigerant leak reports been filed?
4. Where PAS 2035 registered, provide coordinator qualifications, the number of retrofit assessments completed, and any scheme non-conformances.
5. Has the business ever had a BUS grant application rejected, or been subject to a DESNZ compliance audit? If so, provide full details and the resolution.

Commercial

1. List all local authority, housing association, and social housing contracts, including value, term, renewal date, and any performance KPIs or penalties.
2. What is the customer acquisition cost by channel (BUS directory, word of mouth, paid advertising, partnerships)?
3. What percentage of installations are new-build versus retrofit, and what pipeline exists from any housebuilder relationships?
4. Provide details of all manufacturer partnerships, including approved installer status, rebate agreements, lead referral arrangements, and any exclusivity terms.
5. What is the geographic coverage: how far does the team travel for installations, and what is the cost and margin impact of that distance?

Legal and compliance

1. Provide all customer contracts and terms and conditions. Are there any outstanding disputes, complaints to RECC or TrustMark, or small claims?
2. List all vehicles, plant, and equipment, distinguishing owned from leased assets, their condition, and the replacement schedule.
3. Provide employer's liability, public liability, and professional indemnity certificates, and details of any claims in the last five years.
4. Are there any ongoing HSE investigations, improvement notices, or prohibition notices?
5. Provide details of any subcontractor arrangements: are subcontractors covered under the company's MCS certification, or do they hold their own?

11. The 12-Month Preparation Timeline

Preparing a heat pump business for sale is a structured, sequential exercise rather than a single event. The timeline below moves from foundational compliance work through to a market-ready data room, and is designed to answer the diligence question bank above before a buyer ever asks.

Months 12 to 10: foundation

• Commission an independent MCS pre-audit to fix any non-conformances before they surface in buyer due diligence (cost: £500 to £1,000).
• Ensure every installer's FGAS certification is current and renewed before expiry.
• Begin tracking job-level margins in the CRM: buyers will ask for this data going back 12 or more months.
• Start building maintenance/service plan revenue. Even 50 plans at £150 a year adds £7,500 of recurring revenue and signals stickiness to buyers, the same dynamic explored under recurring revenue earlier in this guide.
• Register for TrustMark if not already registered.

Months 9 to 7: revenue quality

• Diversify away from single-channel dependency. If 80% or more of leads come from the MCS installer directory, add manufacturer referral partnerships and local authority tender submissions.
• Win at least one social housing or local authority contract, even a small one of 10 to 20 installs, to prove commercial capability beyond residential work.
• Reduce owner involvement in system design by training a senior installer to handle MCS design sign-off.
• Achieve approved installer status with at least two major manufacturers (Mitsubishi, Daikin, Vaillant, Samsung, Nibe).
• Document the BUS grant processing workflow. Buyers want to see a repeatable system, not ad hoc administration.

Months 6 to 5: operational independence

• Appoint or formalise an operations manager who can run day-to-day activity without the owner.
• Implement a proper CRM if one is not already in place (Simpro, Joblogic, or equivalent); six months of clean data is the minimum a buyer will accept.
• Reduce warranty callbacks by auditing the last 50 installations, identifying repeat failure modes, and retraining or changing suppliers as needed.
• Build a forward pipeline, aiming for 12 or more weeks of signed orders by the time the business goes to market.

Months 4 to 3: financial preparation

• Engage an accountant to prepare normalised management accounts, stripping out owner perks, one-off costs, and personal expenses.
• Calculate defended EBITDA: the sustainable, repeatable profit after a buyer replaces the owner.
• Prepare a schedule of all assets (vehicles, tools, heat pump stock, scaffolding) with current values.
• Get a professional valuation or indicative range from an M&A adviser, for example via DealFlowAgent's valuation calculator.

Months 2 to 1: market readiness

• Prepare a confidential information memorandum, or engage an adviser to do so.
• Brief key staff, including the operations manager and senior installers, on retention: buyers will want them tied in.
• Ensure all certifications (MCS, TrustMark, FGAS, Gas Safe, manufacturer approvals) have 12 or more months remaining before expiry.
• Clean the data room: three years of accounts, tax returns, bank statements, the customer list, the contract schedule, certification documents, insurance, vehicle leases, and staff contracts.

Owners further out from a transaction should read our broader exit planning guidance alongside this timeline, and can review live acquirer interest through our buyer match service.

12. Conclusion: Maximising Value in 2026

To achieve a premium valuation in 2026, a heat pump or decarbonisation business must demonstrate:

1. Revenue Quality: A clear shift away from volatile domestic grant work toward commercial contracts and recurring maintenance.
2. Impeccable Compliance: Zero exposure to the insulation defect scandal and rigorous adherence to MCS and PAS 2035 standards.
3. Workforce Stability: A loyal, directly employed, and fully certified engineering team.

The market is consolidating rapidly, driven by well-funded PE platforms and utility majors. Businesses that can provide scale, compliance, and predictable revenue will command platform-tier multiples, while those exposed to policy cliffs and quality failures will struggle to exit.

For owners 12 to 36 months from a sale event, we build a detailed valuation and business optimisation report that typically identifies six to seven figures of additional enterprise value. Available standalone, or included as part of our sell-side advisory engagement for businesses planning a sale within 12 months.

• Book a valuation call
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Frequently asked questions

What EBITDA multiple does a heat pump business sell for in 2026?

Owner-operated businesses under £1m SDE typically trade at 2.5x to 4.5x SDE. Local leaders with £1m to £3m EBITDA achieve 5.0x to 7.0x. Regional platforms with £3m to £10m EBITDA achieve 7.0x to 10.0x, and national leaders above £10m EBITDA can reach 10.0x to 18.5x or higher. See the full EBITDA ladder above.

How much does recurring maintenance revenue add to the multiple?

Acquirers pay a 1.0x to 2.5x EBITDA premium where maintenance plan revenue exceeds 50% of total revenue. Recurring service income insulates the business from grant cycles and project volatility, which is the single biggest driver of multiple expansion within a band. The same dynamic is priced across the sector in our maintenance contracts valuation guide.

Does exposure to the ECO insulation defect scandal affect my sale?

Severely. The Public Accounts Committee found in January 2026 that 98% of external wall insulation and 29% of internal wall insulation installed under ECO up to mid-January 2025 had defects requiring remediation, with TrustMark suspending 38 installers. Without documented quality assurance and independent sign-off, acquirers typically walk away because the liability is unquantifiable.

Is MCS certification necessary to sell a heat pump business?

Yes for any strategic buyer. MCS certification is a prerequisite for Boiler Upgrade Scheme access (£7,500 standard, £9,000 off-gas-grid until March 2027). A business without MCS certification and PAS 2035 adherence is effectively unsellable to a compliance-driven acquirer.

Do US HVAC multiples apply to UK heat pump businesses?

No. The US has no standalone heat pump buyer universe; installation is absorbed into the HVAC and insulation roll-up market. The 14.9x pre-synergy multiple in the QXO acquisition of TopBuild reflects a national distributor and installer, not a pure-play UK heat pump installer. UK and US pricing is compared in the HVAC EBITDA multiples guide.

How long does it take to sell a heat pump or retrofit business?

A prepared process runs six to nine months from mandate to completion. Grant-exposed businesses need a longer preparation window because buyers underwrite policy risk, so start exit planning 12 to 24 months out.

How is the consideration paid in a heat pump business sale?

Structure scales with deal size. Sub-£2m deals pay 75 to 85% cash at completion with the balance in short deferred consideration. Deals between £5m and £15m typically move to 55 to 65% cash, with deferred consideration, an earn-out, and often equity rollover into a buyer's platform making up the rest. See the full deal structure table for earn-out triggers and deferred consideration protections specific to this sector.

What do buyers ask for during due diligence on a heat pump business?

Buyers work through a structured set of financial, operational, regulatory, commercial, and legal questions, covering everything from MCS certificate status and FGAS records to BUS grant approval rates and maintenance plan retention. The full diligence question bank sets out all twenty-five questions in detail.

Glossary

For definitions used across the wider building services market, see the glossary in our HVAC valuation guide and the full list of valuation guides. Accountants and solicitors advising heat pump business owners can also review our adviser referral programme.

References

[1] GOV.UK, "Warm Homes Plan," March 2026.

[2] Adastra Equity, "HVAC Business Valuation & EBITDA Multiples," June 2026.

[3] Gryd Energy, "The Future Homes Standard is Published," March 2026.

[4] London Stock Exchange, RNS: "Recommended final cash acquisition of Kinovo plc," 14 May 2025.

[5] London Stock Exchange, RNS: "Placing & Acquisition," 11 June 2025.

[6] Sureserve Group, "Sureserve expands into the Netherlands through the acquisition of Bonarius," November 2025.

[7] Sureserve Group, "Sureserve acquires LCX to expand renewable energy services," October 2024.

[8] London Stock Exchange, RNS: Lords Group Trading plc, 28 October 2024.

[9] Vital Energi, "Corran Capital raises new £80m fund and acquires stake in Vital Energi," March 2024.

[10] QXO Inc, "QXO to Acquire TopBuild for $17 Billion," 19 April 2026.

[11] House of Commons Public Accounts Committee, "Faulty energy efficiency installations," 23 January 2026.

[12] Energy Saving Trust, "The Great British Insulation Scheme (GBIS) explained," June 2026.

[13] Warm Home UK, "ECO4 Extended to December 2026," 2026.

[14] Internal Revenue Service (IRS), "FAQs for modification of sections 25C, 25D under Public Law 119-21," August 2025.

[15] GOV.UK, "Boiler Upgrade Scheme," April 2026.

[16] MCS Certified, "The 2026 Low Carbon Landscape," 2026.

[17] Retrofit Academy, "PAS 2035 Guide," 2026.

[18] Elite Renewables, "Heat Pump Statistics 2026," January 2026.

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Disclaimer

This guide is for informational purposes only and does not constitute financial, legal, or tax advice. Valuations are estimates based on publicly available data and DealFlowAgent's market experience. Actual transaction values depend on specific circumstances. Seek independent professional advice before making any decision regarding the sale or acquisition of a business.

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Joined full-time on 22 August 2026 from the largest M&A advisory firm in the UK, owned by K3 Capital. As an ex-Director he managed teams of M&A advisors, analysts and associates, working daily with business owners, buyers and stakeholders on live acquisition deals. Selected from 260 applicants alongside colleagues from investment banking backgrounds, he brings that experience and network to lead the advisory bench across Building Services, Facilities Management, and Healthcare.

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Joined full-time on 22 August 2026 from the largest M&A advisory firm in the UK, owned by K3 Capital. As an ex-Director he managed teams of M&A advisors, analysts and associates, working daily with business owners, buyers and stakeholders on live acquisition deals. Selected from 260 applicants alongside colleagues from investment banking backgrounds, he brings that experience and network to lead the advisory bench across Building Services, Facilities Management, and Healthcare.

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Martin Watson

Senior Building Services & FM Advisor

Martin is one of the most well-connected figures in UK fire, security, building services and FM. He is Chairman of both the Fire Industry Association and the British Security Industry Association, the only person in the UK to hold both roles simultaneously. Martin spent over a decade in senior leadership at Mitie, latterly as Industry Liaison Director for its fire and security division, helping scale the business past £500m in revenue and playing a role in the £366m acquisition of Marlowe plc, which created one of the UK's largest compliance, fire and security services groups. He joined DealFlowAgent because owners in these sectors deserve a genuine sector-specialist advisor across valuation, business optimisation and buyer access. In recognition of his industry roles, he acts in a personal, non-partisan capacity.

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Martin is one of the most well-connected figures in UK fire, security, building services and FM. He is Chairman of both the Fire Industry Association and the British Security Industry Association, the only person in the UK to hold both roles simultaneously. Martin spent over a decade in senior leadership at Mitie, latterly as Industry Liaison Director for its fire and security division, helping scale the business past £500m in revenue and playing a role in the £366m acquisition of Marlowe plc, which created one of the UK's largest compliance, fire and security services groups. He joined DealFlowAgent because owners in these sectors deserve a genuine sector-specialist advisor across valuation, business optimisation and buyer access. In recognition of his industry roles, he acts in a personal, non-partisan capacity.

Industry Partner

Nick Barker

Industry Partner, Hiring and Leadership

Nick leads FM Talent Partners, the facilities management and real estate leadership search firm, and is a leading specialist in building services and FM management talent. He partners with DealFlowAgent on two-way referrals: helping business owners and acquirers fill the key roles that decide whether a business is sellable, and introducing owners who are thinking about their next chapter to a team that knows their industry and their market. Key-person dependency is one of the two most common reasons a sale collapses, and Nick fixes it at source.

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Nick leads FM Talent Partners, the facilities management and real estate leadership search firm, and is a leading specialist in building services and FM management talent. He partners with DealFlowAgent on two-way referrals: helping business owners and acquirers fill the key roles that decide whether a business is sellable, and introducing owners who are thinking about their next chapter to a team that knows their industry and their market. Key-person dependency is one of the two most common reasons a sale collapses, and Nick fixes it at source.

James Duboullay

Senior M&A Advisor

• •25+ years across investment banking, M&A and fundraising
• •Sector focus: essential services and software
• •Long-standing relationships with private equity buyers and growth funds
• •Personally advising DealFlowAgent founders for the past four years

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• •25+ years across investment banking, M&A and fundraising
• •Sector focus: essential services and software
• •Long-standing relationships with private equity buyers and growth funds
• •Personally advising DealFlowAgent founders for the past four years

Emerson Patton

Sector Specialist: Building Services & Facilities Management

• •20+ years advising owners in building services, fire safety, HVAC, plumbing, and construction
• •Guided 200+ companies through growth, profit improvement, and exit planning
• •Builds equity value and operational structure long before a sale
• •Partners with DFA to prepare owners for exit while the advisory team runs the sale

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• •20+ years advising owners in building services, fire safety, HVAC, plumbing, and construction
• •Guided 200+ companies through growth, profit improvement, and exit planning
• •Builds equity value and operational structure long before a sale
• •Partners with DFA to prepare owners for exit while the advisory team runs the sale

Kaya Kesici

M&A Advisor, Fire Safety, Security & Compliance

• •17 completed M&A transactions over the past six years across UK SME fire safety, security and compliance-led services
• •Sell-side and buy-side experience, buyer research, acquirer mapping, outreach and live process coordination
• •Information request lists, databook prep, IC-style summaries and EV-to-equity bridge work
• •Direct sector exposure across fire protection, security systems, CCTV, access control and intruder alarms

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• •17 completed M&A transactions over the past six years across UK SME fire safety, security and compliance-led services
• •Sell-side and buy-side experience, buyer research, acquirer mapping, outreach and live process coordination
• •Information request lists, databook prep, IC-style summaries and EV-to-equity bridge work
• •Direct sector exposure across fire protection, security systems, CCTV, access control and intruder alarms

Previously

Ranger Fire & Security · Complete Building Services · Compliance Group

Joe Lewin

Founder, DealFlowAgent

• •22 completed M&A transactions
• •Direct relationships with hundreds of strategic and financial acquirers
• •Previously built a mobility and field services business to 30 staff and 6 UK warehouses, then sold via competitive process with an EY M&A partner
• •Raised £2m in funding; placed 3rd of 1,900 at OnStage (the "Y Combinator of Europe")
• •Full-stack developer of advanced agent systems and second-brain tooling for the M&A process

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• •22 completed M&A transactions
• •Direct relationships with hundreds of strategic and financial acquirers
• •Previously built a mobility and field services business to 30 staff and 6 UK warehouses, then sold via competitive process with an EY M&A partner
• •Raised £2m in funding; placed 3rd of 1,900 at OnStage (the "Y Combinator of Europe")
• •Full-stack developer of advanced agent systems and second-brain tooling for the M&A process

Call: 020 7293 0327

Recruited Per Deal

Sector Expert

Industry-Specific Advisor

For every engagement we add a sector specialist from your industry to the core team: a 15–25 year operator or advisor with direct relationships in your niche. Recruited per deal so you get the right fit, not a generalist.

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For every engagement we add a sector specialist from your industry to the core team: a 15–25 year operator or advisor with direct relationships in your niche. Recruited per deal so you get the right fit, not a generalist.

The bench is growing. Two senior M&A hires confirmed for late July 2026, selected from 200+ applicants out of Goldman Sachs, Deutsche Bank, EY, KPMG and leading boutique M&A firms. See open roles →

Proprietary Technology

The AI layer behind every advisor

Two in-house AI systems work alongside the human bench. They are software, not people, built and supervised by the advisory team.

AI Agent

Sage

AI Deal Concierge

Available 24/7. Monitors every signal in your deal and keeps the advisory team one step ahead. Trained on thousands of M&A transactions.

AI Agent

Sterling

Buy-Side Deal Origination Agent

Engages 13,000+ acquirers to surface live mandates and intent, then feeds your advisors with warm, ranked buyer matches.