Morgan Stanley’s Private Equity Division Considers Sale of HVAC Company Sila, Sources Indicate

By Abigail Summerville

NEW YORK – Morgan Stanley’s middle-market buyout division is considering the sale of Sila Services, which could be valued at approximately $1.5 billion, including debt, according to sources familiar with the situation.

Sila Services, based in King Of Prussia, Pennsylvania, provides residential services such as heating, air conditioning, and plumbing. The company is currently collaborating with investment bank William Blair to facilitate the sale process, though the sources requested anonymity due to the confidential nature of the matter.

It is estimated that Sila could achieve a valuation equivalent to around 15 times its 12-month earnings before interest, taxes, depreciation, and amortization (EBITDA), which are nearly $100 million.

Morgan Stanley Capital Partners, the owner of Sila, chose not to comment on the situation. Both William Blair and Sila did not respond to requests for comment.

Founded in 1989, Sila operates more than 30 brands that provide a variety of services in residential heating, ventilation, air conditioning, electrical work, and plumbing across the Northeast, Mid-Atlantic, and Midwest regions of the United States.

In 2021, Morgan Stanley Capital Partners acquired Sila for an undisclosed sum. This division focuses on acquiring mid-sized companies and is part of Morgan Stanley Investment Management, which oversees $1.5 trillion in assets.

Private equity firms have been active in acquiring businesses within the residential services sector due to their consistent cash flows and the potential for consolidation within this fragmented industry. For example, General Atlantic invested in Flint Group earlier this year, and L Catterton purchased LTP Home Services Group in 2022. Additionally, The Wrench Group, another residential services firm, counts TSG Consumer Partners, Leonard Green & Partners, and Oak Hill Capital among its investors.