Steve’s breakdown: The company is Residex and the reason for the rebrand is because they’ve been bought. The new brand will be Target Specialty Products. No word on who’s doing the work.
READING, PA & NOVI, MI: Rentokil Initial plc
announces its continued expansion in North America with the acquisition of pest control and turf products distribution business Residex for $30 million.
The acquisition increases the scale of the company’s existing pest and turf products business, which more than doubles in size. It creates the second largest business of this type in the U.S. market, delivering national coverage and a greater density footprint.
Andy Ransom, chief executive of Rentokil Initial plc, said: “I’m delighted to welcome the Residex team to Rentokil Initial. North America is a strategic growth market for Rentokil with great potential for continued profitable growth and our acquisition pipeline remains strong. The addition of Residex means that our business in North America is set to deliver annualized revenues of around $1 billion by the end of the year – some two years ahead of our expectations.”
Founded in 1946, Residex was the distribution arm of New Jersey-based Western Pest Services. When Rollins acquired Western Pest Services in 2004, Residex President Chris Donaghy orchestrated a management buy-out. In 2010, Residex merged with Turfgrass, a distributor serving the golf and turf industry, to further strengthen the organization. As part of that acquisition Todd Griebe became president of the combined organizations.
John Myers, CEO of Rentokil North America, told PCT the acquisition helps Rentokil fill out its coverage area throughout the Eastern U.S. Although Rentokil, through its distribution arm Target Specialty Products, already has an Eastern U.S. presence, “there were gaps,” Myers said. “We think the Residex acquisition will really reduce our costs because there will be less freight for our business; and we think we’ll be able to provide better service to our customers because we’ll be more local than in the past.”
Because of this “infilling of geography” Myers said he does not anticipate office closures as a result of the merger.
Residex also appealed to Rentokil because of its mix of pest control and golf/T&O products. When Rentokil acquired Western Exterminator in 2013, included in that deal was Western’s distribution arm Target Specialty Products. Like Residex, Target does significant golf/T&O product sales — about a 50/50 split between pest control product sales and golf/T&O product sales, Myers said.
While Myers said it is too early to discuss new management structure of the combined distributors he did say Griebe will remain with the company and be relied upon for his expertise in the T&O/golf market. Myers added that in the immediate future Residex and Target Specialty Products will continue to operate as separate brands, but that Residex likely will be rebranded as Target Specialty Products in the future.