The private equity firms that own the two largest companies in the landscape industry today signed an agreement to merge the two green industry giants.
KKR, which owns the Brickman Group, will purchase a majority share in ValleyCrest Landscape Cos. from MSD Capital. Combined, the two landscape firms will have nearly $2 billion in revenue, employ 22,700 people and cover every major U.S. market.
The merger, which is subject to customary closing conditions, is expected to close by mid-2014.
Under the agreement, announced today in a press release, Andrew Kerin will be CEO of the combined companies and Roger Zino, currently CEO of ValleyCrest, will serve as vice chairman. Kerin will continue to work out of Brickman’s Rockville, Md., headquarters and Zino will remain at the former ValleyCrest headquarters in Calabasas, Calif.
“We are excited to bring together two family founded industry pioneers to continue shaping the industry while caring for client relationships that have been built over decades,” Kerin said in the release. “We share common values and have each achieved local, regional and nationwide success by putting our people and clients at the center of all that we do. Together we will be able to offer clients even more innovative and customized solutions while also providing our extremely talented teams greater opportunities for professional growth and development.”
Richard Sperber, son of ValleyCrest founder Burt Sperber and current chairman of the board, will be leaving the company to pursue other interests, said Caroline Weilert, spokeswoman at ValleyCrest. The Sperber family will continue to own their proportional share of the combined company, she said.
“We have known and respected one another for many years, and have always shared a commitment to superior customer service, a relentless focus on employee safety and support of the environment and communities in which we live and work," Zino said in the release. "This is an ideal match that will advance the landscape profession by bringing together a passionate community of the best trained and knowledgeable landscape professionals in the country.”
News of the acquisition came just a few months after KKR purchased a majority share in Brickman for $1.6 billion. Michael Dell’s MSD Capital investment fund bought a majority stake in ValleyCrest in 2006.
Brickman ranks second on the 2014 L&L Top 100 List, with $900 million in total revenue, and ValleyCrest ranks first, with $992 million in 2013 revenue. Brickman grew by 9.6 percent last year, and ValleyCrest grew 12.7 percent.
ValleyCrest also operates in several other green industry segments, including golf course maintenance and construction, nursery operations. Its national maintenance business, U.S. Lawns, is ranked 9th on the Top 100 list with revenue of more than $195 million.
Weiller said U.S. Lawns remains in place right now and will continue to be the franchise arm of the combined company.
More: Find out what industry consultants think of the merger.
