Southern Cross Electrical (ASX:SXE) shares closed 7.8% higher at A$4.99 on Monday 12 October 2026 after the company, known as SCEE, agreed to buy Melbourne fire protection and HVAC group Entire Operations for up to A$112.1 million. It also lifted its FY27 EBITDA guidance to at least A$110 million.
What SCEE is paying for Entire
According to SCEE’s ASX announcement, the deal is cash-free and debt-free, with completion expected on 1 November 2026, subject to conditions including ACCC clearance. The price has three parts:
- A$70 million upfront, paid from SCEE’s existing cash
- Up to A$25.8 million in base earn-outs, payable after FY27, FY28 and FY29 if Entire delivers at least A$17 million of EBIT in each year
- Up to A$16.3 million in outperformance earn-outs if Entire beats higher EBIT targets
Entire made A$191 million in revenue and A$17.5 million in EBIT in FY26. It employs more than 490 people, with about 90% of revenue from Victoria and 10% from Queensland. About 35% of its revenue comes from recurring maintenance and minor works.
Its biggest market is commercial buildings (30%), followed by data centres (25%), infrastructure (20%), health and aged care (15%), and other sectors including government (10%).
The guidance upgrade
SCEE raised its FY27 EBITDA guidance to at least A$110 million, up from the “at least A$100 million” it set in June. The new figure assumes completion on 1 November and includes about A$10 million of EBITDA from Entire.
SCEE expects the deal to lift FY27 pro forma earnings per share by at least 18%.
Why SCEE can afford it
SCEE ended FY26 with record cash of A$261.5 million, helped by a A$150 million placement in June. It reported FY26 underlying EBITDA of A$77.0 million and a record order book of A$810 million.
Managing director Graeme Dunn said “Mechanical (HVAC) is a logical adjacency for SCEE,” pointing to the sector tailwinds both businesses share. The deal adds mechanical (HVAC) services and builds on SCEE’s fire protection business, which it expanded through its earlier acquisition of Force Fire.
What insiders have done
SCEE’s most recent director notices, lodged on 8 October, show three directors taking up new shares through the company’s dividend reinvestment plan at A$4.869 each. That includes Karl Paganin, who now holds 1,985,822 shares. These were dividend reinvestments rather than on-market purchases, so they are not a buying signal. Our Megaport insider trading analysis explains why the type of trade matters.
What SXE investors should watch
- Completion on 1 November, which the new guidance assumes
- Entire’s FY27 EBIT, with A$17 million needed to trigger the base earn-out
- Data centre demand, which accounts for a quarter of Entire’s work and is a key growth area for SCEE
- Director trades in Appendix 3Y notices after the rally
Bottom line
SCEE is using part of its record cash pile to expand into HVAC and grow its fire services, paying A$70 million upfront for a business earning A$17.5 million a year in EBIT. With guidance lifted to at least A$110 million and at least 18% EPS accretion forecast, the market liked the deal, sending Southern Cross Electrical shares 7.8% higher.
