Roark Capital Acquires ServiceMaster for $1.5 Billion

ServiceMaster Clean joins the Roark Capital portfolio as one of five brands acquired by the private equity firm in a deal for ServiceMaster Brands.

Roark Capital Group added another brand to its wide-ranging franchise portfolio with the acquisition October 1 of residential and commercial restoration and cleaning services company

ServiceMaster Brands for $1.5 billion. ServiceMaster is the umbrella franchisor of ServiceMaster Restore, ServiceMaster Clean, Merry Maids, Furniture Medic and Amerispec, which have more than 1,850 franchisees across the U.S. and in nine other countries.

A massive private equity firm, Atlanta-based Roark owns varied franchise brands including Anytime Fitness and Massage Envy, along with Inspire Brands and Focus Brands, which in turn operate restaurants such as Arby’s and Jimmy John’s (Inspire), and Cinnabon and Auntie Anne’s (Focus).

Roark brought in Elane Stock as CEO of ServiceMaster Brands. Stock, who from 2014 to 2017 was group president of Kimberly-Clark International and responsible for its personal care and consumer goods operations in several countries, also sits on the board of directors for Yum Brands, Equifax and consumer goods company Reckitt Benckiser.

Stock, in a statement, said she is "excited to leverage Roark’s experience in service-sector franchising to help further accelerate our franchisees’ growth." Roark’s existing service brands include the likes of automotive franchisor Driven Brands and home improvement company Installation Made Easy

The firm’s interest in the cleaning and restoration sector is hardly surprising. The segment overall pulled in $8.8 billion in sales in 2019, according to Franchise Times Top 200+ data, an increase of 5.9 percent.

While M&A activity has slowed some during the pandemic, the service sector has continued to draw interest, with Restoration 1 and Bluefrog Plumbing + Drain in April landing a majority investment from MPK Equity Partners and Princeton Equity Group. And in a webinar last week focused on restaurants, National Franchise Sales Vice President Michael Ingram noted, "the private equity groups have been coming out of the woodwork" as they see opportunity ahead.

Since its founding in 2001, Roark has invested in 88 franchise/multi-location brands, which generate approximately $43 billion in annual system revenues. It has $18 billion in assets under management.

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