HVAC Breaking News

Oct. 9, 2006: ServiceMaster Announces Sale of American Residential Services

October 9, 2006
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DOWNERS GROVE, Ill. - The ServiceMaster Co. announced that it has completed the sale of American Residential Services, its HVAC business, to Caxton-Iseman Capital Inc. and Royal Palm Capital Partners Inc. Caxton-Iseman, a New York private equity firm, is the majority investor in the transaction. Donald Karnes and David Slott, former officers of a subsidiary of ServiceMaster, are investors in the venture and will participate in the management of the company.

The cash proceeds of approximately $100 million were in line with expectations and related book value. The company intends to use the proceeds to pay down debt and to finance acquisitions in other service lines. The transaction, combined with the previously announced sale of American Mechanical Services, will also result in the acceleration of the timing of approximately $33 million of tax benefits into 2006 and 2007 that were previously expected to be realized in annual installments, primarily through 2012.

"This represents the culmination of a very comprehensive process led by our outside advisors William Blair & Company," stated Ernie Mrozek, president and chief financial officer. "We are pleased that our people will be joining reputable, well financed buyers and that the business will remain headquartered in Memphis."

Publication date: 10/09/2006

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