APi Group Corporation ( APG ) has entered into a definitive agreement to acquire Elevated Facility Services Group, a service provider for elevator and escalator equipment.

APi will acquire Elevated from a fund managed by L Squared Capital Partners for approximately $570 million in cash.

The transaction will expand APi’s position as a premier provider of safety services focused on non-discretionary, regulatory driven applications.

The acquisition is expected to expand APi’s total addressable market by approximately $10 billion and create a long-term cross-selling opportunity.

The acquisition is expected to contribute about $220 million in annual revenue and accretive to adjusted earnings per share.

“We have long viewed the elevator and escalator service market as very attractive due to the highly recurring nature of the business, driven by non-discretionary, statutorily driven demand," said President and CEO Russ Becker.

The transaction is expected to close in the second quarter of 2024, subject to customary closing conditions and regulatory approvals. 

APi Group ( APG ) held $479 million in cash and equivalents as of December 31, 2023.

Outlook: The company raised the lower end of its first-quarter FY24 revenue outlook, revising the range to $1.590 billion – $1.610 billion from $1.560 billion – $1.610 million.

APi currently sees an adjusted EBITDA of $172 million – $177 million and adjusted free cash flow ahead of last year.

Price Action: APG shares closed lower by 2.08% at $38.56 on Friday.