SCEE expands into HVAC with $112.1m Entire acquisition

Entire acquisition lifts SCEE’s FY27 earnings target

Southern Cross Electrical Engineering Limited (ASX:SXE) is paying up to $112.1 million for a Victorian fire protection and mechanical services group, in a transaction the company says will lift FY27 EBITDA guidance to at least $110 million. The deal is forecast to add at least 18% to pro forma FY27 earnings per share, although completion has not yet occurred.

SCEE will pay $70 million upfront in cash, with the balance tied to Entire Operations’ performance through FY27, FY28 and FY29. The earn-outs comprise up to $25.8 million if Entire delivers EBIT of at least $17 million in each year, plus up to $16.3 million linked to higher targets that rise to $27.5 million of EBIT in FY29.

Entire brings fire, HVAC and fabrication capabilities

Established in 1985, Entire generated $191 million of revenue and $17.5 million of EBIT in FY26. It employs more than 490 people across Victoria and Queensland, providing engineering, design, fabrication, construction, commissioning and maintenance services across fire protection and mechanical HVAC work.

Its revenue is spread across commercial projects, infrastructure, data centres, health and aged care, and government work. Data centres represented about 25% of FY26 revenue, while maintenance, minor works and services accounted for about 35%. The business also reports more than $800 million in project pipeline, around 120 active clients and approximately 200 managed sites.

The acquisition broadens SCEE beyond its established electrical, communications, security and fire capabilities into HVAC, while strengthening its Victorian footprint. Entire generates about 90% of revenue in Victoria and 10% in Queensland, complementing SCEE’s existing fire presence in New South Wales and Queensland. The transaction follows the company’s earlier $150 million placement, which was announced to support working capital, new contracts and potential acquisitions.

Cash funding and completion conditions

SCEE says the purchase will be funded from existing cash reserves and that it expects to retain a strong balance sheet after completion. The announced FY27 EBITDA contribution from Entire is $10 million, based on completion occurring on 1 November 2026, lifting pro forma combined FY27 EBITDA to more than $120 million in the investor presentation.

Completion remains subject to customary conditions, including an Australian Competition and Consumer Commission waiver or approval, no material adverse change in Entire, employment agreements with its existing executive shareholders and the release of Entire’s existing financial arrangements. Those executive shareholders are expected to remain with the business under long-term contracts extending beyond the earn-out period.

The immediate attraction is clear in the headline numbers, but the more revealing test will be operational: whether SCEE can combine its national customer base and multidisciplinary offering with Entire’s Victorian scale without losing the management team and recurring service revenue that underpin the acquisition case. The first hard checkpoints are completion and Entire’s contribution to FY27 earnings after the proposed November handover.