FirstService Corporation (TSX and NASDAQ: FSV) (“FirstService”)
announced today that it has entered into a definitive agreement to
acquire Global Restoration Holdings, LLC (“Global Restoration” or
the “Company”), the second largest commercial and large loss
property restoration firm in North America. The acquisition will
expand FirstService’s scale and capabilities in the property
restoration sector and complement its existing Paul Davis
Restoration franchised and company-owned operations, which
collectively are already a leading player in the residential
segment of the industry. The transaction is subject to customary
closing conditions, including regulatory approvals, and expected
closing is mid-year.
Headquartered in Denver, Colorado and founded in
1998, Global Restoration provides integrated end-to-end solutions
encompassing mitigation, restoration and reconstruction services on
behalf of blue chip, national clients which include large,
multi-location commercial customers, property owners and insurance
companies. The Company operates under two highly recognized brands,
Interstate Restoration in the U.S. and FirstOnSite Restoration in
Canada, and employs approximately 1,400 staff operating out of 58
regional offices throughout North America. For the fiscal year
ended December 31, 2018, Global Restoration generated revenues of
$436 million and operating income of $40 million.
Under the terms of the transaction, FirstService
will acquire 95% of the Company for a purchase price of $505
million. Global Restoration’s senior management team, including
Jeff Johnson, Stacy Mazur and Dave Demos, will continue to lead
day-to-day operations and will retain the balance of the equity.
The purchase price will be funded through a combination of cash on
hand and fully committed debt financing.
“We are delighted to be partnering with
FirstService,” said Jeff Johnson, Executive Chairman of Global
Restoration. “The cultural fit, attractiveness of the FirstService
partnership model, and opportunity to continue building our company
over the long-term were differentiating factors for us. With the
backing and credibility of a highly-regarded, large public company,
we are now well-positioned to accelerate our growth for many years
to come.”
“Global Restoration has delivered an exceptional
track record of growth over the past 20 years,” said Stacy Mazur,
CEO of the Company. “We look forward to further building upon the
operational expertise we have established within the large loss and
commercial restoration services segment and capitalizing on future
growth opportunities with FirstService.”
FirstOnSite Chief Executive Officer, Dave Demos,
cited that FirstService will be an ideal partner in the Company’s
next chapter. “We share values and vision, taking us one step
closer to our goal of global leadership in our industry.”
“Global Restoration is a significant transaction
for FirstService, providing an excellent strategic fit and strong
cultural alignment,” said Scott Patterson, CEO of FirstService.
“With its scale, leading market position and operational
excellence, the Company offers a unique opportunity to accelerate
our growth in the massive property restoration industry. Global
Restoration’s expertise is highly complementary to our Paul Davis
franchise system, enhancing our ability to deliver seamless,
full-service capabilities to every customer segment in the
industry. On behalf of our entire organization, I would like to
welcome Jeff, Stacy, Dave and the rest of their strong team into
the FirstService family,” he concluded.
Global Restoration is being sold by Delos
Capital, a lower middle market private equity firm. Houlihan Lokey
is acting as financial advisor and Goodwin Proctor as legal counsel
to Global Restoration. Fogler, Rubinoff LLP and Ferrante &
Associates acted as legal counsel to FirstService.
ABOUT FIRSTSERVICE
CORPORATIONFirstService Corporation is a North
American leader in the essential outsourced property services
sector, serving its customers through two industry-leading service
platforms: FirstService Residential, North America’s largest
manager of residential communities; and FirstService Brands,
one of North America’s largest providers of essential property
services delivered through individually branded franchise systems
and company-owned operations.
FirstService generates approximately $2 billion
in annual revenues and has more than 20,000 employees across North
America. With significant insider ownership and an experienced
management team, FirstService has a long-term track record of
creating value and superior returns for shareholders. The
Common Shares of FirstService trade on the NASDAQ and the Toronto
Stock Exchange under the symbol “FSV”.
For the latest news from FirstService
Corporation, visit www.firstservice.com.
ABOUT DELOS CAPITALDelos
Capital, founded in 2013, is a lower middle market private equity
firm specializing in management buyouts, recapitalizations, and
growth investments. For more information, visit
www.deloscap.com.
FORWARD-LOOKING STATEMENTS
This press release contains statements that
constitute “forward-looking statements” within the meaning of
applicable securities legislation, including, but not limited to,
the expected closing of the proposed transaction, the impact of the
proposed transaction on FirstService’s business and future
financial and operating results and the scope of the expected
financing for the proposed transaction. Much of this information
can be identified by words such as “expect to,” “expected,” “will,”
“estimated” or similar expressions suggesting future outcomes or
events. FirstService believes the expectations reflected in such
forward-looking statements are reasonable but no assurance can be
given that these expectations will prove to be correct and such
forward-looking statements should not be unduly relied upon.
Forward-looking statements are based on current
information and expectations that involve a number of risks and
uncertainties, which could cause actual results or events to differ
materially from those anticipated. These risks include, but are not
limited to, risks that: a condition to the closing of the proposed
acquisition may not be satisfied; a regulatory approval that may be
required for the proposed acquisition is delayed, is not obtained
or is obtained subject to conditions that are not anticipated;
FirstService is unable to promptly and effectively integrate Global
Restoration’s businesses; management’s time and attention is
diverted on transaction-related issues; FirstService or Global
Restoration is unable to retain key personnel; and other risks
related to FirstService’s business, including those identified in
FirstService’s annual information form for the year ended December
31, 2018 under the heading “Risk factors” (a copy of which may be
obtained at www.sedar.com) and Annual Report on Form 40-F filed
with the United States Securities and Exchange Commission (a copy
of which may be obtained at www.sec.gov), and subsequent filings.
Forward-looking statements contained in this press release are made
as of the date hereof and are subject to change. All
forward-looking statements in this press release are qualified by
these cautionary statements. Unless otherwise required by
applicable securities laws, we do not intend, nor do we undertake
any obligation, to update or revise any forward-looking statements
contained in this press release to reflect subsequent information,
events, results or circumstances or otherwise.
COMPANY
CONTACTS:
D. Scott
PattersonPresident &
CEOFirstService Corporation(416)
960-9500
Jeremy
RakusinCFOFirstService
Corporation(416) 960-9500
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