Appliance Repair Services Sector M&A Activity Part 1
Although the recent M&A transactions between Serviz and Porch, Commercial Appliance Service and Parts Town, and Broughton Appliance Service and Appliances on Lakeside were each unique in deal structure, it's noteworthy that in all three cases, the acquisition target maintained its independent name and website following the merger.
SERVIZ / PORCH
- In August of 2018, Seattle-based home service platform Porch acquired Los Angeles-based home service platform Serviz.
- Currently, Porch is a fairly sizable company, with almost 900 employees, a network of over three million professionals, and a record of facilitating over 130 million service jobs.
- In contrast, Serviz was a smaller competitor, having facilitated closer to 40,000 service jobs in the past three years.
- Although the terms of the deal were not disclosed, Serviz announced that the deal would enable the company to expand its business by accessing more customers, offering better services and creating more work for their home-service professionals.
- Additionally, Porch CEO Matt Ehrlichman highlighted that deal was part of a larger corporate strategy for Porch, focused on expanding their business through inorganic growth in the form of partnerships and M&A deals.
- In particular, Porch highlighted the "advanced technology" and portfolio of business that Serviz would contribute to the Porch ecosystem.
- Notably, as part of the deal, Porch committed to maintaining the Serviz "brand, website and experience," while still integrating the Serviz technology into Porch.com.
- Moreover, Serviz maintained its Los Angeles headquarters, along with 50 personnel, including Serviz General Manager Jason Whitt.
- However, Serviz CEO Zorik Gordon did not transition to the newly merged entity.
COMMERCIAL APPLIANCE SERVICE / PARTS TOWN
- In March of 2019, foodservice products distributor Parts Town acquired fellow foodservice products distributor Commercial Appliance Service.
- Parts Town has grown significantly from its founding in 1987 from six employees to more than 500, while also expanding its local customer base to a mix of local, national and international customers.
- In contrast, Commercial Appliance Service has remained more limited in size and scope, with business focused primarily on its markets in Northern California and Northern Nevada.
- Notably, no formal, public announcement of the deal was released, and publicly available literature on the Commercial Appliance Service acquisition was limited to a credit announcement by Moody's Investor Service.
- As such, information related to the motivations and stipulations of the acquisition are limited, however it appears likely that the deal was part of Parts Town's larger growth strategy through the acquisition of fellow foodservice products distributors, including the purchase of PartsXpress in July of 2018.
- Meanwhile, while any transitions in leadership due to the deal were not announced, the president of Commercial Appliance Service, John Schwindt Hawkins, held the executive role at the foodservice products distributor before the deal was finalized, and continues to publicly present himself in that role as part of his leadership within the Commercial Food Equipment Service Association.
- Similarly, Commercial Appliance Service continues to maintain its name and independent website.
BROUGHTON APPLIANCE SERVICE / APPLIANCES ON LAKESIDE
- In October of 2018, Virginia-based appliance retailer and servicer Appliances on Lakeside acquired Virginia-based appliance repair service Broughton Appliance Service.
- Appliances On Lakeside and Broughton Appliance Service both have a more limited sales footprint, specifically within the larger Richmond, VA area, however Appliances On Lakeside has a more diverse set of sales and service offerings.
- Notably, Appliances On Lakeside posted an announcement of the deal on the corporate website, however there appear to be no other significant, publicly available references to the deal.
- As such, information related to the motivations and stipulations of the acquisition are limited.
- However, Appliances on Lakeside did announce that the deal would allow the joined companies to provide better service to their existing footprint of customers, and it appears likely that the deal was intended to buttress or expand the complimentary appliance service operation of Appliances on Lakeside with Broughton Appliance Service's more focused appliance repair operations.
- Additionally, while any transitions in leadership due to the deal were not announced, it appears that the leadership of Broughton Appliance Service either left the company after the merger or moved to different roles within the company, given that Mrs. Tammy Kelley is now the principal, president and/or owner of both Appliances on Lakeside and Broughton Appliance Service, according to the Better Business Bureau.
- However, Broughton Appliance Service continues to maintain its name and independent website.