This year has been a year of investment for the ValleyCrest Cos., which has acquired two design/build firms and launched a full-service high-end residential business.
Investment continues today at the high-profile national firm; however, it’s not strictly ValleyCrest’s capital managing the venture. Rather, the Calabasas, Calif.-based company announced today, MSD Capital, the private investment firm of Michael S. Dell, founder and chairman of Dell Inc., has obtained a majority ownership interest in the company. Financial terms of the transaction were not disclosed.
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Day-to-day operations at ValleyCrest will not change as members of its management team, including ValleyCrest founder and CEO Burton S. Sperber, President Richard A. Sperber and Stuart Sperber, CEO of Valley Crest Tree Company, have retained significant equity ownership in the company and will continue to lead the business.
“Over our 57-year history, ValleyCrest has always made decisions that we feel best benefit the people most important to us – our employees and our customers – and this new partnership is no different,” Burt Sperber says. “MSD Capital shares our values and long-term perspective of the $50 billion landscape industry and we welcome them to the ValleyCrest family.”
ValleyCrest, founded in 1949, is ranked No. 2 on Lawn & Landscape’s Top 100 list, reporting more than $700 million in annual revenue. ValleyCrest remains a privately held company and reports no plans to go public.
“We’re really excited about the MSD partnership,” Richard Sperber says. “They really understand what we want to do, which is to be a world-class customer service company and to continue to take care of our employees and customers. Who’s better at customer service? Michael Dell is an innovator in developing customer service. In the end it came down to a new partner who understands our customer base, understands our business and will let us continue to do what we want to do.”
Richard Sperber added that the partnership with MSD enables ValleyCrest to continue to invest in the capabilities required to meet all of its customers’ landscape needs, including landscape architecture, design/build, installation, maintenance, tree care and tree growing and moving.
With a 95 percent commercial customer base, ValleyCrest discovered significant synergies with MSD, which manages a large commercial portfolio as well.
ValleyCrest also plans to test the high-end residential market through its new Estate Garden initiative. While ValleyCrest has been heavily focused on the design/build service segment of the landscape industry for much of the year, the investment from MSD may help accelerate its pace.
“All the impact is positive,” Richard Sperber says. “Design/build is really a major focus for us. We have a specific plan behind how we will continue to grow that business and we’re on target.”
MSD Capital, L.P., was formed in 1998 to exclusively manage the capital of Michael Dell and his family. The firm engages in a multi-disciplinary investment strategy encompassing traditional private equity activities, real estate and investments in publicly traded securities, in each case with the objective of building an investment portfolio focused on maximizing long-term capital appreciation.
Eric J. Rosen, head of private equity at MSD Capital, considers ValleyCrest “an extraordinary business which has a unique service offering and a premier brand within the landscape services industry.”
