Sweeping Industry News Bulletin
Since this press release was provided to WorldSweeper.com on May 19th, our editor has conducted an email exchange designed to learn more about what sweeping (and other) contractors might expect from the changeover in ownership from Transfield to EMCOR.
The exchange, which took place May 19th through May 24th, is available to our readers in PDF format here.
EMCOR Group, Inc. Announces Agreement to Acquire USM Services Holdings, Inc.Norwalk, CT – May 18, 2011
Combination of USM and EMCOR's Services Business Creates Premier Nationwide Provider of Facilities Maintenance Services
EMCOR Group, Inc. (NYSE: EME) today announced that it has entered into a definitive agreement to acquire USM Services Holdings, Inc. ("USM"), a leading provider of facilities maintenance solutions in North America, from Transfield Services Limited (ASE: TSE) in an all-cash transaction for $255 million, representing $225 million for the base USM business plus $30 million for the net present value of a USM tax benefit. Transfield Services Limited is an Australian-based global provider of operations, asset management and project management services. The transaction is expected to close towards the end of June, subject to customary closing conditions. EMCOR will utilize available cash to finance the acquisition.
Headquartered in Norristown, Pennsylvania and with annual revenues of approximately $375 million, USM is a leading provider of essential facilities maintenance services, including interior and exterior services and electrical, mechanical and plumbing services, to national and regional commercial customers that typically maintain more than 100 sites across wide geographic areas. With its highly-developed proprietary network of over 11,000 service partners, USM delivers consistent facilities maintenance services across a nationwide footprint for approximately 150 customers in over 75,000 locations in all 50 states and Canada.
Tony Guzzi, President and Chief Executive Officer of EMCOR, commented, "We are excited to be acquiring USM, which further strengthens EMCOR's market leading position in facilities and maintenance services. Led by an outstanding and experienced management team, USM is a highly respected provider of facilities maintenance services to some of the most prominent retail, banking, and other commercial companies across the country. Our two businesses are highly complementary to each other, as USM is a leader in predictive, scheduled interior and exterior maintenance services, while EMCOR leads the market in providing site-based and mechanical services and other electrical and mechanical trades services. In an environment in which customers are increasingly looking to centralize their outsourcing with a quality provider, we will together offer a compelling, comprehensive value proposition that is unmatched in the marketplace."
Mr. Guzzi continued, "Our combination with USM, a leader in a very large, growing and highly fragmented market, will offer access to potential new customers for EMCOR's capabilities in energy efficiency, retrofit projects, building controls upgrades, monitoring and maintenance management, and will enable us to bring new services to our existing customers. USM also has excellent revenue visibility and solid margin performance, and by combining aspects of our businesses, we expect to gain greater operational efficiencies and scale that will translate into reduced costs for the benefit of both EMCOR and our customers."
"We look forward to joining the EMCOR team," stated Ivan Dubow, Chief Operating Officer of USM. "Both companies are industry leaders with strong commitments to customer relationships, margin, cash generation and employee development. These shared values speak to a promising future, and we look forward to working together."
For the balance of 2011, the acquisition of USM is expected to add approximately $160 million in revenues and be slightly accretive to EMCOR's diluted earnings per share, after transaction expenses of approximately $6 million. For 2012 and annual periods thereafter, USM is expected to be accretive to EMCOR's diluted earnings per share and generate operating income margin, excluding intangible amortization expenses, in excess of EMCOR's historical peak operating income margins.
Operating efficiencies are expected to be generated from the combination of USM and EMCOR's facilities businesses, resulting in targeted annualized expense reductions of approximately $5 - $6 million over the next two years.
About EMCOR Group, Inc.:
EMCOR Group, Inc. is a Fortune 500 worldwide leader in mechanical and electrical construction services, energy infrastructure and facilities services. This press release and other press releases may be viewed at the Company's Web site at www.emcorgroup.com.
For more information, EMCOR Group may be reached using the following information:
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