***updated on 5/10 with additional information on acquirer Norvestor***
MEMPHIS, Tenn. — Terminix Global Holdings announced it has entered into a definitive agreement to divest its pest management businesses in the U.K and Norway. The acquirer of these assets is Norvestor, a Nordic private equity firm that sold Nomor and Pelias to Terminix for $200 million in 2019. These businesses are being divested by Terminix as a condition to the closing of its pending merger with Rentokil Initial plc.
The divestment is expected to close in the next 30 to 60 days, subject to limited closing conditions. Terminix expects to record a loss on the sale of these assets in the period ending June 30, 2022. Together, the two businesses were expected to generate approximately $60 million in revenue and less than $10 million in Adjusted EBITDA for the full year 2022.
“I want to thank the Norway and United Kingdom teams for their dedication and commitment to our company and customers while at Terminix,” said Terminix CEO Brett Ponton. “Both businesses are well positioned in attractive pest control markets for continued growth and margin expansion under experienced new ownership. Terminix is excited to take another step forward in the pending Rentokil merger as we remain on track for completion in the second half with a targeted closing by the end of the third quarter.”
Completion of the divestment and the previously announced completion of the antitrust review process in the U.S. will satisfy two of the closing conditions to the company's pending merger with Rentokil. Remaining conditions to be satisfied include approval by the company’s and Rentokil’s shareholders, and the registration of Rentokil’s American on the New York Stock Exchange. Both parties continue to make good progress on satisfying these remaining conditions and the transaction remains on track for completion in the second half of 2022, with a targeted closing by the end of the third quarter.
Pelias is a Norwegian company that provides a wide range of pest control, hygiene and building decontamination services to commercial, residential and public customers. Pelias was part of the pest control company Nomor Holding AB, which was owned by Norvestor between 2014 and 2019, and subsequently sold to Terminix. According to a Pelias press release, Pelias has formed a new Northern European pest control group as a result of this acquisition.
“We look forward to working with Norvestor again and believe that we together with Terminix UK can build a leading pest control group, sharing best-practice across and collaborate in developing the pest control offering of the future, driving even more value for our customers and employees”, says Trond Kristiansen, CEO of Pelias.
The Potomac Pest Control Group served as the financial advisor to Terminix for both transactions.