Rollins acquires its first pest control company in the UK

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On 29 June 2016, USA-based Rollins Inc announced the acquisition of Safeguard Pest Control and Environmental Services. This is the company’s first, but unlikely to be its last, acquisition in the UK.
For practical pest controllers, the Rollins organisation might be better known to you through its wholly owned subsidiary, Orkin LLC.

Safeguard sold
Established in 1991 and headquartered in Westerham, Kent, Safeguard is a long established pest control company offering pest control, bird control and specialist services to residential and commercial customers across London, the Home Countries and the South East. Owners Paul Butterick and Tim Sheehan will stay on to run the company’s operations.

Gary W Rollins, vice chairman and chief executive officer of Rollins stated: “The Safeguard acquisition is an important milestone and expands our global presence. Safeguard’s outstanding management team has established the company as an industry leader, and we share a culture of continuous improvement and ongoing investment in training and development. Further, we are pleased that Paul and Tim will remain in leadership roles and look forward to sharing best practices between the two organisations.”

Founded in 1901, by Otto Orkin, the son of Latvian immigrants, he started selling rat poison, door-to-door to neighbouring Pennsylvania farmers. By 1912, he had opened his first office in Richmond, Virginia. However, he expanded into other cities, and in 1926, he moved his headquarters to Atlanta, Georgia. He eventually branched out into pests such as cockroaches, bed bugs and more.

Today, Rollins Inc is a global consumer and commercial services company and through one of its wholly owned subsidiaries, Orkin LLC, provides essential pest control services and protection against termite damage, rodents and insects to more than two million customers in the United States and throughout the globe from more than 700 locations.

Readers may recall the Orkin stand at several of the recent PestEx events. To date their international business plan has been based on the aim of establishing franchise operations.

By the end of 2015 they had achieved 48 international franchises – virtually double the number held in 2013. In Europe this has not met with great success, their shining light being the Orkin franchise in Ireland, although greater success has been achieved in countries such as China.

A switch from franchising to acquisition for Rollins
However, in recent years the company has grown its business
by acquisition.

In Australia, for example, over the last two years three significant pest control businesses were acquired – Murray Pest Control (April 2016), Statewide Pest Management (April 2015) and Allpest WA (February 2014).

Orkin At Pestex 1

Signing-up their latest franchise at PestEx. Extreme left: Tom Luczynski (Orkin group vice president of global development and franchising) with Frank Meek (international technical director) extreme right

These recent purchases by Rollins means there is now a serious competitor to Rentokil who has always been viewed as leading the company acquisitions trail. In fact, in October 2015 Rentokil concluded the deal to buy for $425 million in cash The Steritech Group based in North Carolina, USA. This propelled Rentokil to become the third largest pest control business in the USA with revenues of $440,000,000 – some achievement after their lowly start not that many years ago. Rollins, however, holds top spot in the American pest control servicing market.

Rentokil Initial New Logo 1 Fmt

v Rollins – which one is tops internationally?
Interestingly, further research of the comparative sizes of these two global service companies reveals that Rentokil has a larger total revenue (£1,813.9m*) compared with Rollins’ at $1,485.3m** (£1,143.7m***). However, the Rollins business operation concentrates virtually solely on professional pest control activities. On the other hand, the Rentokil business portfolio includes Hygiene, Plants, Workwear and Other activities in addition to pest control. Despite pest control now being their largest sector, total revenue here is only £791.3m, so considerably smaller than that of Rollins.

If you are thinking of selling-up………
So, for any owner of a pest control company thinking of selling-up, you now have more of a choice of potential buyers. As they say, competition is always a good thing!

* Rentokil Annual Report 2015
** Rollins Annual Report 2015
*** Exchange rate at 6 July 2016

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