Breaking News: March 2000, Acquisitions & Mergers

CALABASAS, Calif. – Environmental Industries Chief Executive Officer Burt Sperber has steadfastly maintained that his organization would make acquisitions when such deals made strategic sense.

EII’s strategy must include strengthening its position along the East Coast as the company announced four acquisitions, highlighted by the purchase of STM Landscape Services in Oakton, Va.

"We have been looking at companies for acquisition, but we had not found anything that excited us like STM did," noted Burt Sperber in an exclusive interview with Lawn & Landscape. "This is a family business just like ours, and its revenue is all from maintenance work."

This entry into the Washington, D.C., market continues EII’s move up the Atlantic Coast – a move that began with EII’s acquisition of Oyler Brothers in Florida nearly 10 years ago. EII also has operations in Atlanta, Ga., and Charlotte, N.C.

STM generated approximately $12 million in revenue last year, and the company will operate as STM Landscape Services, an Environmental Care Co.

EII also confirmed it had completed acquisitions of smaller companies, one in Orlando and two in the Charlotte, N.C., market, although additional details on these acquisitions were not available.

In other acquisition news:

• RBI and West Coast Bridge, two West Coast landscape companies merged to form American Civil Constructors, a company established to consolidate specialty contractors into a platform for a build-up strategy in the landscape and heavy construction markets.

RBI, with offices in Denver, Colo., Salt Lake City, Utah, Dallas, Texas, and San Francisco, Calif., has more than 700 employees and $69 million in revenue.

American Civil Constructors will pursue contractors with public works experience that are located west of the Mississippi River.

• Sanitors, a janitorial and landscape company located in San Antonio, Texas, acquired Russ Fragala Landscape Corp, Coram, N.Y.

This is Sanitors’ first acquisition outside of Texas. Al Honigblum, president of Ground Control, the landscape division of Sanitors, said Fragala will remain on to oversee operations and assist in acquisitions.

Sanitors, which entered the landscape industry with the 1998 acquisition of Ground Control, San Antonio, has offices in 16 states and closed 1999 with a little more than $100 million in revenue – $30 million of which came from landscape services.

"We are looking to expand through acquisition," Honigblum said. "We are looking for companies that are willing to grow at a minimum of 10 percent on an annual basis and expand through consolidation."

So far, Sanitors, which has a corporate goal of $250 to $300 million in annual revenue, has acquired five companies and, according to Honigblum, seven additional acquisitions are in the pipeline.

• TruGreen LandCare acquired Scapes, a $6 million commercial landscape maintenance and residential and commercial design/build company with locations in Atlanta and Ashburn, Va.

Terms of the sale included all commercial landscape management operations, residential and commercial design-build operations, all trucks and equipment and the transfer of 100 employees – approximately 50 at each location.
– L&L Staff

MERGERS
United Green Mark, Shemin Join

NOVATO, Calif. – United Green Mark (UGM), one of the largest irrigation distributors serving the Western United States, has teamed up with Shemin Nurseries, one of the largest nursery material distributors in the Eastern United States.

The deal was driven by the retirement of UGM co-founder Ric Green as well as a continued evolution of suppliers into more full-service organizations.

"Both UGM and Shemin are tightly focused on serving the professional end of the green industry and do not pursue retail sales," noted a release announcing the deal. "Both companies have been working on expanding their product mix and services offered, believing that the industry is best served by a one-stop philosophy that maximizes its customers’ purchasing and operational efficiency."

Mark Agnew will remain chief executive officer of UGM, which has 34 locations in four states and annual sales of $150 million. Shemin Nurseries and its 20 locations are led by Bob Shemin. Both UGM and Shemin Nurseries are now part of a new holding company, Shemin Holdings, and the organizations will operate with their current management teams in place.

While immediate expansion plans aren’t known for the new organization, the company’s release did explain that in today’s era of consolidation, "this union will provide the necessary resources for both Shemin Nurseries and UGM to become the ‘acquirer of choice.’
– Bob West

ACQUISITIONS
Andersons Buys Scotts’ Pro Turf

COLUMBUS, Ohio – Consolidation within the professional turf industry picked up steam when The Scotts Co. agreed to sell its U.S. professional turf business to The Andersons, Maumee, Ohio, and its Canadian professional turf business to Nu-Gro. The deal is expected to close by May 31.

The Andersons will acquire the U.S. rights to the Pro-Turf®, Contec™, AccuPro™ and other professional turf brands and their associated distribution network, product inventories, customer lists and all trademarks, patents and copyrights associated with the professional turf market. Nu-Gro acquires rights to the same assets for the Canadian market. The Scotts® brand name, however, is not part of this transaction.

The transaction does not include any of Scotts’ consumer, grass seed, lawn care services or horticultural businesses.

According to Scott Todd, senior vice president of Scotts Professional Business Group, the professional turf industry in North America has become saturated. He predicted a snowball effect to follow the sale announcement. "This is the catalyst to a much-needed consolidation in this industry," he said, pointing out the negative effects of an increased number of suppliers.
– Scott Hunsberger