Transaction Spotlights

SMG

Overview: Gold standard in venue management and food & beverage services

Key Learnings & Transaction Takeaways:

  • Attractive business model with contractual relationships and high renewal rates
  • Demonstrated high ROIC on capital expenditures
  • Favorable market position with high barriers to entry and entrenched industry relationships

Read the press release here

Liquid Environmental Solutions

Overview: North America’s largest, vertically integrated provider of grease trap and related services
Key Learnings & Transaction Takeaways:

  • Mission cricital service offering with small ticket, big impact value proposition
  • Highly scalable platform given significant investments in people, processes, and systems
  • Proven ability to source, execute, and integrate acquisition targets

Read to press release here

What We're Reading

U.S. SERVICE INDUSTRIES GROW NEAR FASTEST PACE IN A DECADE

Bloomberg Markets - March 5, 2018

U.S. service industries expanded in February near the fastest pace in at least a decade, signaling the economy is on track for steady growth this quarter, according to a survey from the Institute for Supply Management. The results from the Tempe, Arizona-based group extend the solid start to the year for services that account for about 90 percent of the economy and span industries such as retail, utilities, health care, and construction. The February index compares with a 57 average for all of 2017. 
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WASTE MANAGEMENT ACQUIRES ANDERSON RUBBISH DISPOSAL AND MOORPARK RUBBISH DISPOSAL

Business Wire press release from Waste Management - March 19, 2018

"G.I. Industries, dba Waste Management (NYSE:WM) of Houston, today announced that it has acquired Anderson Rubbish Disposal and Moorpark Rubbish Disposal. The newly acquired businesses include the assets associated with these businesses’ residential, commercial, and industrial solid waste and recycling collection services, equipment, vehicles, and customer agreements. Mike Smith, Waste Management director of operations, said. 'This acquisition will allow us to grow as the assets align perfectly with our existing operations furthering our environmental solutions throughout the region.' "
Read the full article here

Atlantic Irrigation Joins Forces with SiteOne Landscape Supply

Business Wire press release from SiteOne Landscape Supply - February 12, 2018

"SiteOne Landscape Supply, Inc., the largest and only national wholesale distributor of landscape supplies in the United States, announced today the acquisition of Atlantic Irrigation. Started in 1976, Atlantic is a leader in the distribution of irrigation, lighting, drainage and landscaping equipment with 33 locations across 13 states in the Eastern US and two provinces in Eastern Canada. 'Atlantic significantly expands the scale of our irrigation and lighting business in the Eastern US and Canada markets. This transaction represents the largest number of locations that we have acquired in a single acquisition in more than a decade,' said Doug Black, Chairman and CEO of SiteOne Landscape Supply." 
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What We've Been Hearing

Excerpts from Recent Earnings Calls 

“…We closed the acquisition of Avendra on December 11, and we closed the acquisition of AmeriPride on January 19. We're thrilled to be welcoming these experienced and talented teams to Aramark. We had engaged in intensive planning, so we could hit the ground running on day one for each of these acquisitions, ready to begin in executing against our integration plans. We expect that these strategic transactions will enhance our competitive position across the portfolio of businesses and that they present compelling opportunities to create synergies and deliver sustainable value for our shareholders.”

“…We acquired Veolia's U.S. industrial cleaning business for $120 million in cash. This business generated about $210 million in revenue in 2017 through 1,300 employees across 60 different locations, and they have an extensive fleet of vehicles and equipment. This acquisition essentially doubles the size of our U.S. industrial business and creates scale that we believe will enable us to enhance our service offering and drive profitable growth.”

“…To meet the demand of our customers, we expanded our recycling processing capabilities through the acquisition of ReCommunity. Our customers have told us recycling is important to them and have demonstrated their willingness to pay. Additionally, to ensure the sustainability of recycling, we have transitioned approximately 85% of our processing volume to a more durable, fee-based model.”

Public Comparables

Market Index (as of April 4, 2018) 

Index

Information included in this Industry Update was sourced from FactSet.