Selling a refractory business is not like selling a tech startup or a retail chain. The value is in what others can’t see—unless you show them.
Whether you’re a field contractor, precast producer, or high-heat material blender, preparing for diligence means making your risk profile—and your value—transparent. Buyers want more than financials. They want to know your crews, compliance, backlog, and safety culture are ready to scale.
Here’s how to get your refractory business ready for a smooth and successful M&A diligence process.
1. Clean and Normalize Financials
Buyers will request:
3–5 years of P&Ls, balance sheets, and cash flow statements
Revenue by customer and service line
Adjusted EBITDA with add-backs for owner salary, vehicles, non-recurring legal, etc.
🎯 Hire a QofE (quality of earnings) firm if you’re a $10M+ seller—it reduces buyer friction and accelerates valuation clarity.
2. Document Safety and Regulatory Compliance
Include:
OSHA/WSIB reports
Jobsite incident logs
Training certifications and standard safety protocols
Insurance certificates and claim history
🎯 In a field-intensive industry, safety records drive buyer comfort and risk pricing.
3. Map Labor Structure and Key Roles
Provide:
Org chart with tenures and comp levels
Union agreements (if applicable)
Subcontractor agreements and usage rates
Turnover and retention rates
🎯 Buyers will want to know if crews will stay—and if supervisors carry institutional knowledge.
4. Inventory Your Backlog and Project Pipeline
Include:
Signed contracts and active bids
Maintenance vs. new construction ratio
Margin profile by project type
🎯 The goal is to demonstrate not just historic earnings—but future visibility.
5. Assess Equipment and Facility Readiness
Prepare:
Fixed asset register with age, condition, and location
Maintenance schedules and CapEx history
Real estate leases, ownership docs, or renewal terms
🎯 Help buyers assess plant consolidation or asset replacement cost early.
6. Summarize Customer Relationships
Provide:
Top 10 customer list with tenure and annual revenue
Contract length and terms
Churn risk or pending rebid situations
🎯 Concentration isn’t a dealbreaker—if it’s well-documented and defensible.
: Preparing for Diligence Isn’t About Hiding Flaws—It’s About Controlling the Narrative
Buyers don’t expect perfection. They expect clarity. The more you control the diligence process—through organized data, professional communication, and transparency—the more value you retain. In the refractory world, trust isn’t optional. It’s part of the deal.
