Watsco Acquires Southern Ice Equipment Distributors

Rhea-AI Summary

Watsco (NYSE: WSO) has completed three strategic acquisitions in 2025, expanding its distribution network in key Sunbelt markets. The main acquisition is Southern Ice Equipment Distributors, a leading distributor of food-service and commercial refrigeration equipment founded in 1984, with seven locations across Louisiana, Mississippi, Arkansas, Texas, New Mexico, and Arizona. The other acquisitions include Lashley & Associates in Houston and Hawkins HVAC Distributors in the Carolinas. Combined, these acquisitions add 10 new locations and approximately $47 million in annualized sales. Southern Ice will maintain its brand name and current leadership team. Watsco, which has completed 72 acquisitions since 1989, operates the largest HVAC/R distribution network in North America with 702 locations serving approximately 375,000 professionals annually.

Positive

• Addition of $47 million in annualized sales through strategic acquisitions
• Expansion into high-growth Sunbelt markets with 10 new locations
• Diversification of product offerings with new brands and broader distribution network
• Retention of existing leadership teams ensuring business continuity
• Strong market position with 702 locations serving 375,000 professionals annually

Negative

• Financial terms of the acquisitions not disclosed, limiting assessment of deal value
• Integration risks associated with managing multiple simultaneous acquisitions
• Potential operational challenges in coordinating expanded distribution network

Insights

Business Strategy Expert

Watsco's acquisition of Southern Ice and two other distributors strengthens Sunbelt presence, diversifies into commercial refrigeration, adding $47M in annual sales.

Watsco's acquisition of Southern Ice Equipment Distributors represents a strategic expansion beyond traditional HVAC into food-service and commercial refrigeration equipment. This diversification enhances Watsco's product portfolio while maintaining their proven integration approach of preserving acquired companies' identities and leadership teams.

The company's disciplined "buy and build" strategy continues to yield results, with three acquisitions already completed in 2025 adding 10 new locations and approximately $47 million in annualized sales. These transactions specifically strengthen Watsco's footprint in high-growth Sunbelt markets across Louisiana, Mississippi, Arkansas, Texas, New Mexico, Arizona, North Carolina, and South Carolina.

What's particularly strategic about these acquisitions is their alignment with Watsco's focus on the replacement market. With the company noting 102 million HVAC systems in the U.S. older than 10 years, these expanded distribution points position Watsco to capitalize on inevitable replacement cycles in regions experiencing strong population growth.

Southern Ice's established relationships with manufacturers like Manitowoc Ice (Pentair division) provide Watsco immediate credibility in the commercial refrigeration sector. Meanwhile, the acquisition of Lashley & Associates (commercial supplies and custom air movement products) and Hawkins HVAC Distributors (HVAC equipment and supplies) complement this expansion with additional product diversification.

Having completed 72 acquisitions since 1989, Watsco has clearly mastered the art of identifying and integrating complementary businesses while preserving their operational strengths and customer relationships.

Financial Analyst

Watsco's three strategic acquisitions deliver $47M in new annual sales, expanding high-margin distribution network in growing Sunbelt markets.

Watsco's acquisition strategy continues to deliver tangible growth with these three transactions adding approximately $47 million in annualized sales. While the purchase price remains undisclosed, this revenue injection strengthens Watsco's already substantial distribution network now spanning 702 locations that serve approximately 375,000 customers annually.

The strategic value extends beyond mere revenue addition. By acquiring Southern Ice Equipment Distributors (established 1984), Watsco gains entry into the commercial refrigeration sector - a complementary market to their core HVAC business with similar distribution economics but different seasonal patterns, potentially smoothing quarterly performance.

These acquisitions demonstrate disciplined market selection, focusing exclusively on high-growth Sunbelt regions where population trends and construction activity create favorable conditions for both new installations and the replacement market Watsco emphasizes. The expansion across seven southern states (Louisiana, Mississippi, Arkansas, Texas, New Mexico, Arizona, North Carolina, and South Carolina) strengthens regional density, typically improving distribution economics through routing efficiencies and inventory optimization.

Watsco's approach to these acquisitions follows their established playbook: maintaining brand identity and leadership teams while providing growth capital and technology resources. This reduces integration risk while allowing acquired companies to benefit from Watsco's scale and systems.

The focus on energy-efficient replacements also positions Watsco favorably in the growing market for sustainability-focused upgrades. Their claim of averting 23.7 million metric tons of CO2e emissions through higher-efficiency system sales demonstrates the financial opportunity in this segment as regulations and consumer preferences increasingly favor energy-efficient solutions.

Leading Food-Service and Commercial Refrigeration Distributor in Sunbelt Markets

MIAMI, May 05, 2025 (GLOBE NEWSWIRE) -- Watsco, Inc. (NYSE: WSO) announced that it has completed the acquisition of Southern Ice Equipment Distributors as well as two other transactions completed thus far in 2025. Terms of the transactions were not disclosed.

Founded in 1984 and based in Lafayette, Louisiana, Southern Ice is a leading distributor of food-service and commercial refrigeration equipment, parts and supplies, including products manufactured by Manitowoc Ice, a division of Pentair plc. The Company operates seven locations in key Sunbelt markets including Louisiana, Mississippi, Arkansas, Texas, New Mexico and Arizona. Southern Ice will operate under its existing name and under the direction of its current leadership team to provide continuity to customers, employees and OEM partners.

In addition to Southern Ice, Watsco completed two other acquisitions earlier in the year:

• Lashley & Associates, a distributor of commercial supplies and custom air movement products based in Houston, Texas, was purchased in January 2025.
• Hawkins HVAC Distributors, a distributor of HVAC equipment and supplies with locations in Charlotte, North Carolina and Columbia, South Carolina was acquired in April 2025.

With these acquisitions, Watsco has added 10 new locations and approximately $47 million in annualized sales in high-growth Sunbelt markets that provide new brands, broader product offerings and expanded distribution points to better serve customers.

Albert H. Nahmad, Watsco's Chairman and Chief Executive Officer, commented: “We are pleased to welcome these great businesses to the Watsco family. We look forward to investing in their growth plans, leveraging our transformative technology platforms, and supporting customers and employees as part of our family.”

Watsco is actively seeking additional opportunities to invest and grow through acquisitions. Since entering distribution in 1989, Watsco has completed 72 acquisitions, including many multi-generation, family-owned businesses. Watsco’s “buy and build” strategy can be summarized as follows:

• Identify and partner with great businesses in the HVAC/R industry
• Support their leadership and employees and honor their culture and legacy
• Ask for aggressive growth plans and help them achieve their ambitions
• Motivate teams and reaffirm an ownership culture with long-term equity
• Deploy the industry’s most comprehensive suite of customer-focused technologies
• Solicit and collaborate on big ideas to foster a spirit of innovation and growth

About Watsco
Watsco operates the largest distribution network for heating, air conditioning and refrigeration (HVAC/R) products with locations in the U.S., Canada, Mexico, and Puerto Rico, and on an export basis to Latin America and the Caribbean. Watsco estimates that over 375,000 owner-operators, technicians, and installers visit or call one of its 702 locations each year to get information, obtain technical support and buy products.

We focus on the replacement market, which has increased in size and importance due to the aging of installed systems, the introduction of energy efficient models and the necessity of HVAC products in homes and businesses. According to data published in March 2023 by the Energy Information Administration, there are approximately 102 million HVAC systems installed in the United States that have been in service for more than 10 years, most of which operate below current efficiency standards.

Accordingly, Watsco has the opportunity to be a significant and important contributor toward climate change as it plays an important role to lower CO2e emissions. According to the Department of Energy, HVAC systems account for roughly half of U.S. household energy consumption. As such, replacing older systems at higher efficiency levels is a critical means for homeowners to reduce electricity consumption and their carbon footprint.

Based on estimates validated by independent sources, Watsco averted an estimated 23.7 million metric tons of CO2e emissions from January 1, 2020 to March 31, 2025 through the sale of replacement HVAC systems at higher-efficiency standards, an equivalent of removing 5.5 million gas powered vehicles annually off the road. More information, including sources and assumptions used to support the Company’s estimates, can be found at www.watsco.com.

This document includes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may address, among other things, our expected financial and operational results and the related assumptions underlying our expected results. These forward-looking statements are distinguished by use of words such as “will,” “would,” “anticipate,” “expect,” “believe,” “designed,” “plan,” or “intend,” the negative of these terms, and similar references to future periods. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to changes in economic, business, competitive market, new housing starts and completions, capital spending in commercial construction, consumer spending and debt levels, regulatory and other factors, including, without limitation, the effects of supplier concentration, competitive conditions within Watsco’s industry, the seasonal nature of sales of Watsco’s products, the ability of the Company to expand its business, insurance coverage risks and final GAAP adjustments. Detailed information about these factors and additional important factors can be found in the documents that Watsco files with the Securities and Exchange Commission, such as Form 10-K, Form 10-Q and Form 8-K. Forward-looking statements speak only as of the date the statements were made. Watsco assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information, except as required by applicable law.

Barry S. Logan 
Executive Vice President
(305) 714-4102
e-mail: blogan@watsco.com

FAQ

What companies did Watsco (WSO) acquire in 2025?

In 2025, Watsco acquired Southern Ice Equipment Distributors, Lashley & Associates (January), and Hawkins HVAC Distributors (April).

How much additional revenue will Watsco's 2025 acquisitions generate?

The three acquisitions are expected to add approximately $47 million in annualized sales to Watsco's revenue.

How many locations did Watsco add through its 2025 acquisitions?

Watsco added 10 new locations through its three acquisitions in 2025, expanding its presence in Sunbelt markets.

How many acquisitions has Watsco completed since entering distribution?

Since entering distribution in 1989, Watsco has completed 72 acquisitions, including many multi-generation, family-owned businesses.

Will Southern Ice Equipment Distributors keep its brand name under Watsco?

Yes, Southern Ice will continue to operate under its existing name and current leadership team to maintain continuity with customers, employees, and partners.