Kingsway Expands Market Reach with Roundhouse Acquisition
New York, Wednesday, 2 July 2025.
Kingsway acquired Roundhouse for $22.4 million, marking its ninth acquisition under the KSX Search Xcelerator initiative. Roundhouse’s strong recurring revenue and growth potential underline this strategic move.
Strategic Acquisition: Comparison with Industry Trends
On July 2, 2025, Kingsway Financial Services Inc. (NYSE: KFS) announced its strategic acquisition of Roundhouse Electric & Equipment Co., Inc. for a purchase price of $22.4 million. This acquisition is a significant move for Kingsway, marking the ninth acquisition under its KSX Search Xcelerator initiative. Such acquisitions align with Kingsway’s strategy to enhance its portfolio in the asset-light industrial equipment services sector [1][2].
Financial Standing and Potential of Roundhouse
The acquisition of Roundhouse highlights both companies’ robust growth potential. Roundhouse reported unaudited trailing twelve-month revenues of $16 million and an adjusted EBITDA of $4.2 million. These figures not only underscore Roundhouse’s capability to generate strong, recurring revenue streams but also enhance Kingsway’s operational value [1][2]. This positions the company favorably in the electric motor maintenance, repair, testing, and sales sectors within the Permian Basin [1].
Funding and Financial Impact on Kingsway
The acquisition, which closed on July 1, 2025, was financed through a combination of $10.4 million cash on hand and $11.0 million from a senior credit facility, reflecting a well-structured financial strategy aimed at minimizing immediate financial strain on the company [1]. Kingsway has demonstrated sustained commitment to scaling its operations through targeted acquisitions and improving its market position in key industrial segments [3].
Market and Investment Implications
With Kingsway’s recent acquisitions, including Roundhouse, the company aims to achieve a substantial increase in its acquisition target, moving towards acquiring 3-5 businesses annually. This strategy is consistent with Kingsway’s disciplined capital allocation focused on businesses with long-term recurring revenue streams [3][4]. Furthermore, Kingsway’s current stock dynamics, reflected by a recent price of $14.08 per share with a 4.28% increase over the past 24 hours, suggest positive investor sentiment towards the company’s proactive growth and diversification strategies [6].