Industry Pulse: Year in review

A look at the 2014 headlines that could have a lasting impact on the green industry.

TruGreen: On its own and preparing to grow
ServiceMaster completed the separation of its TruGreen business on Jan. 14. The move was announced in November 2013, after the company reportedly lost 300,000 customers in two years. It was executed as a tax-free spin-off to ServiceMaster stockholders. In March, TruGreen President David Alexander told the Memphis Business Journal the company planned to focus on execution and internal operations in 2014 and it will grow again— organically and by acquisitions—in 2015.

Dawn of ‘Brickman-Crest’
When the Financial Times first reported in April that the landscape industry’s two power players, ValleyCrest Cos. and the Brickman Group, could merge, much speculation surfaced about what it could mean for the industry. First, folks were shocked. But when they looked closer, they realized it made sense, following the November 2013 acquisition of Brickman by New York investment firm KKR. “None of these (private equity) guys like to hold on to things they invest in very long,” explained Bruce Wilson, consultant with the Wilson-Oyler Group and LM columnist. “They like to invest in something for five or six years and then sell it to invest in something else.” ValleyCrest had been majority owned by MSD Capital, Michael Dell’s private investment firm, since 2006.

Though the deal closed June 30, questions remain about how many details will shake out. What brand will the merged entity retain? (Update: The merged entity chose the new name BrightView.) Which company’s structure and culture will be adopted? It’s likely 2015 will hold some of those answers.

TruGreen LandCare’s big hire
Ijamsville, Md.-based landscape maintenance firm TruGreen LandCare appointed Michael Bogan as CEO, effective Nov. 3. He spent 23 years with Brickman before starting a consulting business in 2013.

During Bogan’s tenure at Brickman, he was involved with both organic and acquisition growth opportunities. The appointment is a significant step for TruGreen LandCare, which was purchased from ServiceMaster by Los Angeles-based private investment firm Aurora Resurgence in early 2011, said M&A expert Ron Edmonds of the Principium Group. Expect acquisitions to come.

John Deere Landscapes makes moves
After being acquired last year by private equity firm Clayton, Dubilier & Rice, John Deere Landscapes (JDL) made some news, shaking up the executive team and acquiring companies. Doug Black, formerly with Oldcastle, joined JDL as CEO. The company also picked up several smaller competitors, including Boston Irrigation Supply Co. with five locations in the Northeast; The Stockyard Horticultural Supply in Arlington, Tenn.; Diamond Head Sprinkler Supply in Honolulu; and Eljay Irrigation in Calgary, Alberta. John Deere retains a 40 percent stake in the now standalone company, which has more than $1 billion in annual revenue. Industry observers anticipate a rebranding in its future.

Scotts Lawn Service makes pest play
Scotts LawnService agreed to acquire Action Pest Control, a residential pest control company based in Louisville, Ky., with operations in Indiana, Kentucky and Illinois. The transaction, which is expected to close by January, marks the company’s first acquisition of a residential pest control business. Scotts LawnService, with anticipated sales of approximately $260 million in fiscal 2014, is currently the No. 2 player in the lawn care category behind TruGreen. Scotts LawnService expects the Action Pest Control business to do $15 million in sales in 2015.

Updated: 12/9/14