Reliance Home Comfort

Reliance Home Comfort is a Canadian home-services company whose business developed from Ontario’s long-established natural-gas utility water-heater rental model. The company rents, sells, installs and maintains equipment used in homes and, in some cases, commercial properties. Its offerings include storage water heaters, water-purification equipment, furnaces, air conditioners, heat pumps, generators, smart-home products and service plans covering heating, cooling, plumbing and electrical systems. Reliance’s roots lie in the unregulated water-heater rental operations associated with Union Gas, an Ontario natural-gas utility. From the middle of the twentieth century, Ontario gas utilities commonly worked with builders to install gas-fired water heaters in newly constructed homes. The utility or affiliated provider subsidized and maintained the equipment, while homeowners paid a recurring rental charge, often collected through their utility bill. This arrangement became particularly widespread in Ontario, although it was less common in other parts of Canada. Regulatory changes led to the separation of Union Gas’s unregulated water-heater business in 1999, when it became a sister company known as Union Energy. Union Energy was acquired by EPCOR in 2001, and the operation was expanded through the acquisition of Hydro One’s retail rental division, Ontario Hydro Energy. The combined business was spun off in 2003 as the UE Waterheater Income Fund. As the licensing arrangements associated with the Union Gas and Hydro One names approached expiry, the retail operations were progressively rebranded under Reliance Home Comfort beginning in 2005. The business changed ownership several times during the following decade. Alinda Capital Partners acquired the fund in 2007 in a transaction reported at approximately $1.74 billion. Around that period, Reliance also expanded into security services through the acquisition of Voxcom and Protectron. Those activities were operated under the Reliance Protectron name before being sold to ADT in 2014. After exiting security, Reliance concentrated more heavily on home maintenance and equipment services, while also expanding beyond its historic Ontario base into western Canada. Reliance acquired National Home Services from Just Energy in 2014, adding another home-services operation to its portfolio. In 2017, the company was acquired from Alinda by interests associated with Victor Li and Li Ka-shing through CK Asset Holdings and CK Infrastructure Holdings. The transaction was reported at approximately $2.8 billion, with CK Asset holding 75 percent and CK Infrastructure holding 25 percent. The company’s largest operating presence remains in Ontario, but it has also maintained offices and operations in western Canada and the United States. The company reported serving approximately 1.7 million Canadian customer households as of 2017. Its recurring-rental and maintenance model is built around equipment access, installation, repairs, replacement parts and labour, offering customers an alternative to purchasing and independently maintaining major home systems. Consumer criticism has focused on the long-term cost of rental contracts and the difficulty some customers experienced when cancelling or returning equipment. Reliance has defended the model by emphasizing included maintenance and service support.

Reliance Home Comfort emerged from Ontario’s utility-linked water-heater rental industry. For much of the twentieth century, Ontario gas utilities worked with residential builders to install gas water heaters in newly built homes. Rather than requiring homeowners to buy the equipment outright, the utilities or affiliated businesses typically retained ownership, maintained the units and collected a recurring rental charge. The model became especially established in Ontario because it was integrated with the province’s utility and home-building systems. The company’s immediate corporate predecessor was the unregulated water-heater business associated with Union Gas. Regulatory changes separated that business from the regulated utility in 1999, creating Union Energy as a sister company. EPCOR acquired Union Energy in 2001 for a reported approximately $160 million and later added Hydro One’s retail rental division, Ontario Hydro Energy. The combined business was spun off in 2003 as the UE Waterheater Income Fund. Beginning in 2005, the retail business adopted the Reliance Home Comfort name as the licensing rights connected with the Union Gas and Hydro One brands approached expiry. The rebranding marked a move toward presenting the operation as a broader consumer home-services company rather than solely as a utility-associated water-heater provider. Alinda Capital Partners acquired the fund in 2007 in a transaction reported at approximately $1.74 billion. During and around this ownership period, Reliance diversified into residential security through acquisitions of Voxcom and Protectron. The security activities operated as Reliance Protectron until they were sold to ADT in 2014. Following the divestiture, Reliance redirected its attention toward equipment rental, home-comfort products and maintenance services. The company expanded its service footprint outside Ontario and acquired National Home Services from Just Energy in 2014. This supported a wider offering that included heating and cooling services, water treatment and other forms of home maintenance. Reliance’s business model combined recurring rental revenue with installation, repair and protection-plan services. In 2017, CK Asset Holdings and CK Infrastructure Holdings acquired Reliance from Alinda Capital Partners. The reported ownership structure assigned 75 percent to CK Asset and 25 percent to CK Infrastructure. The companies are associated with the Hong Kong-based Li family, including Victor Li and Li Ka-shing. Reliance subsequently remained a privately controlled home-services business with its largest base of operations in Ontario, alongside offices and activities in western Canada and the United States. The company has reported serving approximately 1.7 million Canadian households as of 2017. Its current scope includes water-heater rental and sales, water purification, smart-home equipment, furnaces, air conditioners, heat pumps, generators, and maintenance or protection plans for HVAC, plumbing and electrical systems. Reliance’s model has attracted consumer criticism because rental payments can exceed the long-term cost of purchasing a water heater. The federal Competition Bureau stated that outright purchase can produce substantial savings over time, while rental providers have argued that recurring payments include maintenance, labour and replacement support. In 2012, the Bureau brought complaints involving Reliance and Direct Energy over alleged restrictions on equipment returns and cancellation charges. Reliance settled its portion in 2014 by agreeing to simplify cancellations and paying a $5 million administrative penalty. The company has also faced homeowner allegations concerning collection attempts for disputed or allegedly undelivered services, although the supplied reference material does not establish a separate adjudicated finding on those allegations.

• 2017

  CK group acquires Reliance

  [1]Reliance Home Comforten.wikipedia.org

  CK Asset Holdings and CK Infrastructure Holdings acquire Reliance from Alinda Capital Partners in a transaction reported at approximately $2.8 billion.

• 2014

  National Home Services is acquired

  [1]Reliance Home Comforten.wikipedia.org

  Reliance acquires National Home Services from Just Energy as part of its expansion in home-maintenance services.

• 2007

  Alinda Capital Partners acquires the business

  [1]Reliance Home Comforten.wikipedia.org

  Alinda Capital Partners purchases the fund in a transaction reported at approximately $1.74 billion.

• 2005

  Reliance Home Comfort branding begins

  [1]Reliance Home Comforten.wikipedia.org

  The retail business begins converting to the Reliance Home Comfort brand as earlier Union Gas and Hydro One brand licensing arrangements near expiry.

• 2003

  UE Waterheater Income Fund is created

  [1]Reliance Home Comforten.wikipedia.org

  The combined Union Energy and Ontario Hydro Energy operation is spun off as the UE Waterheater Income Fund.

• 2001

  EPCOR acquires Union Energy

  [1]Reliance Home Comforten.wikipedia.org

  EPCOR acquires Union Energy for a reported approximately $160 million and later adds Hydro One’s retail rental division.

• 1999

  Union Energy is separated from Union Gas

  [1]Reliance Home Comforten.wikipedia.org

  Regulatory changes lead to the separation of Union Gas’s unregulated water-heater rental business, which becomes a sister company named Union Energy.

A broad home-comfort and maintenance provider combining equipment rental, installation, repair and recurring service plans. Reliance emphasizes convenience, equipment access and maintenance coverage rather than equipment ownership alone.

• Water heating

  Water heaters

  Reliance’s historic core offering is the rental, installation, maintenance and, in some markets, sale of residential water heaters. The rental model gives the company responsibility for servicing, replacement parts and labour under the applicable agreement. Water-heater rentals remain closely associated with the Ontario utility-origin business.

• HVAC

  Heating and cooling systems

  Reliance sells, installs and maintains furnaces, air conditioners and heat pumps. It also provides heating and cooling maintenance or protection plans intended to cover repairs and related service needs over the life of the equipment.

• Water treatment

  Water purification

  The company offers residential water-purification products and related installation or service support, extending its original water-heater focus into broader household water-quality equipment.

• Smart-home technology

  Smart home products

  Reliance’s smart-home activities form part of its broader home-comfort portfolio. The supplied reference identifies smart-home products as an offering but does not specify individual product names, technologies or launch dates.

• Residential power equipment

  Generators

  Reliance sells, installs or services generators for residential customers. The offering complements its heating, cooling and other essential-home-system services, although the supplied material does not identify specific models.

• Maintenance services

  Home maintenance plans

  The company offers maintenance and repair plans for heating and cooling systems and also provides plans or services relating to plumbing and electrical systems. These programs are designed around recurring support, repairs, replacement parts and labour.

• 2014

  Settlement of Competition Bureau matter

  Reliance agreed to make cancellation of water-heater rentals easier and paid a $5 million administrative monetary penalty in connection with the Competition Bureau complaint.

  Source

• 2012

  Competition Bureau complaint over rental cancellation and return practices

  The Competition Bureau complained that Reliance and Direct Energy limited the locations and time windows available to customers seeking to return rented water heaters and imposed allegedly unwarranted cancellation fees. Reliance disputed the allegations and said its policies were intended to protect customers from aggressive tactics by competing rental suppliers.

  Source

Read more

• 2017

  Acquire Reliance from Alinda Capital PartnersM&A

  Background

  Reliance was being transferred from its private-equity ownership under Alinda Capital Partners.

  Action taken

  CK Asset Holdings and CK Infrastructure Holdings acquired the company, with reported ownership of 75 percent and 25 percent respectively.

  Aftermath

  Reliance became controlled by interests associated with Victor Li and Li Ka-shing and continued operating as a privately controlled home-services company.

  Reported transaction value. $2.8 billion (2017 acquisition)

  Source

• 2014

  Acquire National Home ServicesM&A

  Background

  Reliance was seeking to expand its home-maintenance activities and geographic reach.

  Action taken

  Reliance acquired National Home Services from Just Energy.

  Aftermath

  The acquisition contributed to Reliance’s focus on home maintenance and related recurring services.

  Source

• 2014

  Sell Protectron security operationsM&A

  Background

  Reliance was refocusing on home-comfort and maintenance services.

  Action taken

  The Voxcom and Protectron security activities were sold to ADT.

  Aftermath

  Reliance exited the security business and concentrated more strongly on heating, cooling, water, equipment rental and home-maintenance services.

  Source

• 2005

  Adopt the Reliance Home Comfort brandStrategy

  Background

  The company’s rights to use the Union Gas and Hydro One retail names were approaching expiry.

  Action taken

  The retail operations were converted to the Reliance Home Comfort brand, creating a distinct consumer-facing identity.

  Aftermath

  The new brand supported the company’s positioning as a broader home-comfort and maintenance provider rather than only a utility-linked water-heater business.

  Source

1. 1Reliance Home Comforten.wikipedia.org