18 Mar 2014 07:00
News Release
18 March 2014
INTERSERVE PLC
Completion of the Acquisition of Initial Facilities
On 28 February 2014, Interserve Plc, the international support services and construction group, announced that it had entered into a conditional agreement with a subsidiary of Rentokil Initial Plc, to acquire its facilities service business (Initial Facilities)(the Transaction). Interserve is pleased to announce that it has today completed the acquisition of Initial Facilities for a cash consideration of £250 million. Interserve shareholders voted in favour of the Transaction at the General Meeting on 17 March.
Initial Facilities comprises the facilities services businesses of the Rentokil Initial Plc group, with operations in the UK, Ireland and Spain. Employing approximately 25,000 people, it provides a comprehensive range of facilities services.
As stated at the time of announcement of the Transaction, the Board considers that the Transaction will create a strong platform for future growth and in particular will create:
· A strengthened market position and a strong fit of service portfolios, giving Interserve a top three (by revenue) position in the UK support services market (source: Credo, 2013)
· Greater breadth of services and capabilities, allowing the Interserve group as enlarged by the Transaction to broaden its customer proposition and self-deliver certain services that are currently subcontracted
· A wider addressable market due to Initial Facilities having a greater proportion of contracts in the private sector, complementing the current prominent position that Interserve has within the public sector
· The ability to deliver estimated pre-tax cost synergies of approximately £5 million per year by the end of 2015, primarily from streamlined corporate support and operational management functions and procurement efficiencies
· A broader pool of management talent with excellent reputations in the marketplace
Adrian Ringrose, Chief Executive of Interserve, said:
"We are building upon the strength of both companies to create a truly outstanding proposition for our customers, employees and shareholders. Interserve, as a top three player in the market by revenue, now has a more balanced portfolio of clients between the public and private sector, and a greater breadth of services and capabilities by which to grow our presence across the UK facilities management market.
"We have a well developed integration and alignment process which we will now be implementing, and we look forward to providing a further update at our Interim Results in August."
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For further information please contact:
Robin O'Kelly, Interserve +44 (0) 118 932 0123
Richard Campbell/Michael Kinirons, Capital MSL +44 (0) 20 3219 8800
About Interserve
Interserve's vision is to redefine the future for people and places. We are one of the world's foremost support services and construction companies, operating in the public and private sectors in the UK and internationally. We offer advice, design, construction, equipment, facilities management and front-line public services. Interserve is based in the UK and is listed in the FTSE 250 index. We have gross revenue of £3.1 billion and a workforce of over 75,000 people worldwide. www.interserve.com.
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