Private equity firm The Riverside Co. acquired The Dwyer Group from TZP Group. It’s the second time Riverside has owned the Waco, Texas-based parent company of landscape maintenance franchisor The Grounds Guys.
Terms of the deal were not disclosed.
Riverside first purchased The Dwyer Group in 2003, taking the company private. After seven years, the firm sold The Dwyer Group to another private equity investor, TZP Group, in 2010.
Chris Elmore, president of The Grounds Guys, emphasized that it’s rare for a private equity firm to sell and buy back the same company.
“They were impressed with our growth,” he said. “For The Dwyer Group, it’s another injection of oversight and a driver to growth. Two private equity companies have owned us, but this is our third go-around with private equity. For the most part it will be business as usual with an emphasis on efficiency and the initiatives that are most beneficial moving forward.”
For franchise owners at The Grounds Guys, changes should be minimal, Elmore said.
“They’ll probably notice very little change in the day to day,” he said. “Of course, if the parent company gets better, it’ll trickle down in things like systems and software. That’s where they’ll see it the most.”
The Grounds Guys, with $18.2 million in 2013 annual revenue, has grown rapidly since it was founded as a franchise in 2010 in the U.S. It has ranked as the fastest growing company on the Landscape Management LM150 list in both 2013 and 2014.
Elmore expects the brand will have added 50 new franchises by year’s end, totaling about 180 locations. By the end of 2015, he expects the count to be “well over 200.”
He said much of the franchise systems’ expansion is due to entering the market at the right time.
“Our growth is attributed to the fact that we’re filling a void for the local, small contractor that wasn’t gong to be an attractive buyout for a national or regional company,” he said. Elmore noted that after the Great Recession many contractors discovered they needed more help than trade associations or networking could provide. “We were here at the right time.”
Future growth will come in untapped markets, such as Phoenix and Tucson, and regions that can handle multiple The Grounds Guys franchises but currently only have one or two locations, such as Chicago. Elmore noted there are only three locations in California.
