ABM (NYSE: ABM), a leading provider of facility solutions,
announced today that it has reached a definitive agreement to
acquire Able Services, a leading facilities services company
headquartered in San Francisco, in a cash transaction valued at
$830 million. The transaction is expected to close by the end of
September, subject to approval under the Hart-Scott-Rodino
Antitrust Act and other closing conditions.
Founded in 1926, Able is the largest
family-owned provider of building maintenance, engineering and
facility operations in the United States, with revenues of $1.1
billion and adjusted EBITDA of $65 million, normalized for
COVID-19-related impacts. Engineering services represents
approximately 60% of their total revenues, with janitorial services
accounting for approximately 40%. Able’s 80% unionized workforce
provides facility services to over one billion square feet of real
estate, strengthening ABM’s national presence. ABM expects the
transaction to be accretive to adjusted earnings per share
immediately after closing.
The acquisition will also bolster ABM’s
engineering and technical services, which are expected to generate
almost $2 billion of combined annualized revenue and expand ABM’s
sustainability and energy efficiency offerings amid growing demand
for environmentally responsible solutions.
Scott Salmirs, President and Chief Executive
Officer of ABM, noted, “This acquisition is fully aligned with the
strategic plan we have developed to accelerate our revenue growth
and margin expansion in the coming years. Able represents an
excellent strategic and cultural fit for us, adding to our scale in
engineering and janitorial services, which represent priority
growth areas for ABM over the next five years. Additionally, Able’s
commitment to delivering outstanding service to its clients while
engaging with its team members fits well with ABM’s culture and
values. Together, we will build upon our respective strengths and
shared values as we provide a broader array of services to an
expanded client roster.”
Salmirs continued, “Able’s strong engineering
capabilities will assist us in achieving our strategic growth
objectives as we build upon our offerings to include integrated
facilities services and multi-service bundles to our core clients.
At the same time, Able’s substantial janitorial services business
in key geographies and long-standing relationships with large
corporate clients are perfectly aligned with our broader portfolio.
We will gain over $400 million in janitorial services revenue at a
time when safety and health are of primary importance to commercial
clients. Through our EnhancedClean™ offering, ABM has become a
leader in virus protection services, and we believe that our
combined janitorial business will be well-positioned to meet
continued demand for these services in a post-pandemic environment.
We greatly admire Able’s heritage, excellent reputation, and highly
talented team members. Importantly, we both are mission driven
organizations, and our collective purpose has never meant more,
while the value and demand for what we do continues to
increase.”
Paul Saccone, Chief Executive Officer of Able,
said, “This combination provides us with an excellent opportunity
to continue to grow our business, supported by the resources of
ABM. We both have long histories of serving clients and building a
collegial culture that prioritizes being a trusted provider to some
of the largest companies in the world, delivering customized
services and creating leadership paths for our employees. We look
forward to working together to continue to provide clients with
high quality services and support.”
ABM expects to achieve approximately $30 million
to $40 million in cost synergies, the majority of which are
expected be realized within the first year following completion of
the transaction.
Advisors
Goldman Sachs & Co. LLC is serving as
exclusive financial advisor to ABM. Jones Day is its legal advisor.
Stifel and Morrison & Foerster are serving as Able’s financial
and legal advisors, respectively.
Conference Call Information
ABM will host a conference call today at 6:15 PM
Eastern time to discuss this transaction. The live conference call
can be accessed via audio webcast at the “Investors” section of the
Company's website, located at www.abm.com, or by dialing (877)
407-4018 approximately 15 minutes prior to the scheduled
time. A supplemental presentation will accompany the webcast
on the Company's website.
A replay will be available approximately two
hours after the recording through September 8, 2021 and can be
accessed by dialing (844) 512-2921 and then entering ID #13722637.
An archive will also be available on the ABM website for 90
days.
ABOUT ABM
ABM (NYSE: ABM) is a leading provider of
facility solutions with revenues of approximately $6.0 billion and
more than 100,000 employees in 350+ offices throughout the United
States and various international locations. ABM's comprehensive
capabilities include janitorial, electrical & lighting, energy
solutions, facilities engineering, HVAC & mechanical, landscape
& turf, mission critical solutions and parking, provided
through stand-alone or integrated solutions. ABM provides custom
facility solutions in urban, suburban and rural areas to properties
of all sizes - from schools and commercial buildings to hospitals,
data centers, manufacturing plants and airports. ABM Industries
Incorporated, which operates through its subsidiaries, was founded
in 1909. For more information, visit www.abm.com.
Cautionary Statement under the Private
Securities Litigation Reform Act of 1995
This press release contains both historical and
forward-looking statements addressing the plan of ABM Industries
Incorporated (together with its subsidiaries, collectively referred
to as “ABM,” “we,” “us” or “our”) to acquire Able Services
(together with its subsidiaries, collectively referred to as
“Able”). In this context, we make forward-looking statements
related to future expectations, estimates and projections that are
uncertain, and often contain words such as “anticipate,” “believe,”
“could,” “estimate,” “expect,” “forecast,” “intend,” “likely,”
“may,” “outlook,” “plan,” “predict,” “should,” “target” or other
similar words or phrases. These statements are not guarantees of
future performance and are subject to known and unknown risks,
uncertainties and assumptions that are difficult to predict.
For us, particular uncertainties that could
cause our actual results to be materially different from those
expressed in our forward-looking statements include: our ability to
successfully complete the proposed acquisition of Able, including
satisfying closing conditions; any delay in closing the proposed
acquisition of Able; the occurrence of any event that could give
rise to termination of the purchase agreement governing the
acquisition of Able; risks inherent in the achievement of cost
synergies and the timing thereof; risks related to the disruption
to ABM and Able and their respective management as a result of the
proposed acquisition; the effect of the announcement of the
proposed acquisition on Able’s ability to retain and hire key
personnel and maintain relationships with clients, suppliers and
other third parties; our ability to successfully integrate Able if
the proposed acquisition is completed, including whether and to
what extent the proposed acquisition will be accretive within the
expected timeframe; the impact of the COVID-19 pandemic, which has
(i) had and is expected to continue to have a negative effect on
the global economy and the United States economy, (ii) disrupted
and is expected to continue to disrupt our operations and our
clients’ operations, and (iii) adversely affected and may continue
to adversely affect our business, results of operations, cash flows
and financial condition; our ability to gain profitable business
despite competitive market pressures; our ability to attract and
retain qualified personnel and senior management and to manage
labor costs; our ability to preserve long-term client
relationships; changes to our businesses, operating structure,
financial reporting structure or personnel relating to the
implementation of strategic transformations, enhanced business
processes and technology initiatives may not have the desired
effects on our financial condition and results of operations; our
use of subcontractors or joint venture partners to perform work
under customer contracts exposes us to liability and financial
risk; we manage our insurable risks through a combination of
third-party purchased policies and self-insurance, and we retain a
substantial portion of the risk associated with expected losses
under these programs, which exposes us to volatility associated
with those risks, including the possibility that changes in
estimates to our ultimate insurance loss reserves could result in
material charges against our earnings; changes in general economic
conditions, such as changes in energy prices, government
regulations or consumer preferences, could reduce the demand for
facility services and, as a result, reduce our earnings and
adversely affect our financial condition; future increases in the
level of our borrowings or in interest rates could affect our
results of operations; our business may be negatively impacted by
adverse weather conditions and catastrophic events, disasters and
terrorist attacks could disrupt our services.
For additional information on these and other
risks and uncertainties we face, see ABM’s risk factors, as they
may be amended from time to time, set forth in our filings with the
Securities and Exchange Commission, including our most recent
Annual Report on Form 10-K and subsequent filings. We urge readers
to consider these risks and uncertainties in evaluating our
forward-looking statements. We caution readers not to place undue
reliance upon any such forward-looking statements, which speak only
as of the date made. We undertake no obligation to publicly update
any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
Use of Non-GAAP Financial
Information
The Company has presented, in this press
release, an estimate for Able’s adjusted EBITDA contribution.
Adjusted EBITDA is a non-GAAP financial measure which represents
earnings before interest, taxes, depreciation, amortization and
other adjustments. Able uses adjusted EBITDA as a measurement of
financial results and as an indication of the relative strength of
operating performance. The Company's estimate of Able’s adjusted
EBITDA is based only on projected financial information available
as of the date hereof. This non-GAAP financial measure is not
intended to replace the presentation of financial results in
accordance with U.S. GAAP. This non-GAAP financial measure may not
be comparable to similar measures used by other companies and may
exclude certain nondiscretionary expenses and reflect other
adjustments. Reconciliations of this forward-looking non-GAAP
financial measure to the most directly comparable GAAP financial
measure is not provided because the Company is unable to provide
such reconciliation without unreasonable effort, due to the
uncertainty and inherent difficulty of predicting the occurrence
and the financial impact of information concerning amounts of
certain items excluded from adjusted EBITDA, such as amortization
and taxes and items impacting comparability, which are not
determinable on a forward-looking basis at this time.
Contact:
Investor Relations: David Gold (212)
750-5800 ir@abm.com
Media:Nadeen Ayalacommunication@abm.com
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