In line with its acquisition strategy, private equity firm Kohlberg Kravis Roberts & Co. L.P. (KKR) announced a deal to acquire The Brickman Group. Ltd. LLC for $1.6 billion from Leonard Green & Partners, L.P. and other shareholders. Leonard Green & Partners, a Los Angeles-based private-equity firm, acquired a majority stake in Brickman in 2006.
Brickman, founded in 1939, is one of the largest landscape maintenance and snow removal services firms in the U.S. It caters to a diverse portfolio of 10,000 clients with around 10,000 employees all over the country.
The purchase is made through KKR North American Fund XI and other funds and accounts run by Kohlberg Kravis. The deal is expected to close by the end of 2013, subject to the fulfillment of customary closing conditions.
For Brickman, Barclays Capital Inc. an arm of Barclays PLC (BCS), and Morgan Stanley and Co. LLC, part of Morgan Stanley (MS), acted as the financial advisors, while Latham & Watkins LLP and Dechert acted as legal advisors. For Kohlberg Kravis, Credit Suisse Securities (USA) LLC, part of Credit Suisse Group AG (CS) acted as the financial advisor, while Simpson Thacher & Bartlett was the legal advisor.
As the economy is gradually reviving from the financial crisis, the construction sector is rebounding, driving private equity firms to invest in the sector. On Oct 2013, Clayton Dubilier & Rice LLC announced its decision to acquire a majority stake in Deere & Co.’s landscaping business for $465 million.
Kohlberg Kravis has marked its presence in 25 industries across the U.S., ranging from software to healthcare. In Aug 2013, the company announced an agreement to purchase clinical research firm, ReSearch Pharmaceutical Services Inc (RPS) from NY-based global private equity firm, Warburg Pincus. Further, in Oct 2013, the company proposed to acquire 10% stake in Qingdao Haier Co., Ltd. that specializes in home appliances and is a leader in the Chinese market for the same.
Kohlberg Kravis currently carries a Zacks Rank #1 (Strong Buy).
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