Business Description:

American Combustion Acquisition , LLC currently owns the majority of the stock in American Combustion Industries, Inc.

American Combustion Industries, Inc. (ACI) is a $30 million full-service mechanical services firm serving industrial, commercial, and institutional customers in the Maryland, Washington D.C. and Virginia areas.  ACI provides a wide variety of building services to its clients including facility assessment, mechanical, electrical, plumbing, cogeneration plants, and maintenance/repair services.  ACI has expanded its services to focus on mechanical and electrical system installations and renovations. Services include retrofits of all types of heating and cooling systems as well as additional construction services.

Transaction Background:

ACI was purchased by Washington Gas Light Holdings Company in 1998 as a means to diversify its core business.  Over the last several years, ACI has suffered from a lack of attention from its corporate parent and has consistently underperformed as a result.  Blackstreet purchased the company from Washington Gas in conjunction with two local industry veterans, John Kirlin and Tim Kirlin.

Investment Thesis:

Blackstreet believed the business was poorly managed, focused on low margin, competitive bid projects as opposed to the higher margin service jobs which are sourced through relationships.  In addition, the organization required a complete overhaul including flattening the organizational structure and outsourcing or elimninating unprofitable services and divisions.  Finally, expenses were too high to operate as an entrepreneurial $27 million business.