A rapidly growing Stittsville contracting business continued to build up its customer base Wednesday when it pulled the trigger on its second acquisition of 2021.
Power-Tek Group announced the purchase of Shawn Robinson Refrigeration Ltd., an Ottawa-based company that provides refrigeration, heating, ventilation and air conditioning services to commercial and industrial customers in Ontario, Quebec and the Atlantic provinces.
The deal comes hot on the heels of Power-Tek’s April acquisition of Kemptville’s Macton Electrical Construction, whose customers include Smiths Falls-based cannabis powerhouse Canopy Growth and a slew of other commercial clients along the Highway 416 corridor.
Joseph Pamic, Power-Tek’s vice-president of corporate development, says the transactions give the firm added momentum and even more room for growth as it comes off a fiscal 2020 that saw its revenues jump 20 per cent and crack the $10-million mark.
“Construction is very competitive and it’s very cyclical,” says Pamic, whose father Walter co-founded the firm with business partner David Lindsay in 1996. “In my opinion, the best way to combat those two is through growth and diversification.”
Pamic joined the firm in January of last year to spearhead its expansion push. Before entering the family business, the University of Ottawa commerce grad cut his teeth in mergers and acquisitions with Toronto’s Lynx Equity Ltd. and spent two years as director of investment management at Sussex Capital, the private investment firm of legendary entrepreneur Michael Potter.
'A finance guy'
Pamic, who recently earned his MBA at Queen’s, acknowledges he’s not your typical construction executive.
“I’m more of a finance guy,” he explains.
He says working alongside the likes of Potter – who grew Kanata software firm Cognos into one of the city's leading tech companies in the 1980s and '90s – taught him the importance of thinking strategically when it comes to growing a business.
“He came at it with a very scientific viewpoint,” he says of Potter.
Pamic says too many construction firms fall into the trap of relying on a limited pool of customers in a single vertical.
Power-Tek, whose first big customer was Nortel, has tried to avoid that pitfall by building a broad case of clients in government, education and tech, he explains. Notable customers today include the city’s universities, several school boards and Kanata-based KRP Properties.
Diverse service offerings
The founders are electricians by trade who later expanded the business into construction. The latest acquisition adds HVAC and refrigeration expertise to the company’s offerings, and Pamic says Power-Tek is now looking at bringing a plumbing service under its umbrella as well.
“It comes down to that philosophy of trying to diversify,” he explains. “It’s not having all our eggs in one basket when it comes to one customer or one sector.”
The contracting industry is filled with potential acquisition targets, Pamic adds, another reason why the strategy makes sense.
"There’s a large demographic of business owners who are in their late 50s, 60s, 70s with not much of a succession plan."
“There’s a large demographic of business owners who are in their late 50s, 60s, 70s with not much of a succession plan – especially in the trade industry, there’s not a lot of buyers out there,” he says.
“There’s not a lot of (second-generation family members) who go into the trades, so there’s a lot of opportunity in my opinion to buy some great companies with great people and great customers.”
Now at more than 75 employees, Power-Tek is branching out even further, into real estate management and development.
The company recently acquired a pair of four-unit rental properties in Westboro and has purchased a pair of lots in the Carlington neighbourhood, where it plans to build a 25-unit apartment complex. Meanwhile, it also owns a one-acre property in the Stittsville Business Park that’s slated for a 15,000-square-foot industrial building.
The firm’s goal of pursuing multiple revenue streams appears to be paying off. Pamic says Power-Tek is aiming to increase its revenues by at least 60 per cent in the current fiscal year and by another 30 per cent in 2022.
“It’s trying to find (more) ways that we can become valuable to our customers,” he says.