LAWN DOCTOR, INC.
Lawn Doctor, Inc.
Lawn Doctor, Inc. of Holmdel, NJ has been acquired by Levine Leichtman Capital Partners of Beverly Hills, CA. Sperry, Mitchell & Company initiated this transaction, assisted in the negotiations, and served as exclusive financial advisor to Lawn Doctor.
Overview
Lawn Doctor, Inc. (www.lawndoctor.com) is a leading franchisor of residential lawn care businesses. The Company’s nationwide base of over 460 independently-owned franchise locations offers a wide variety of lawn, tree & shrub and pest control programs designed to cultivate healthy and beautiful lawns and foliage.
Levine Leichtman Capital Partners (www.llcp.com) is a well-established private equity firm that invests in middle-market companies located in the United States. The firm has a philosophy of investing alongside entrepreneurs who believe in their companies’ growth and want to retain substantial equity ownership.
Situation
- The majority owner of Lawn Doctor, who co-founded the business in 1967, wanted to sell the company to prepare for retirement, while the CEO and minority owner wanted his son to assume leadership of the company.
- Lawn Doctor had continued its growth in revenues and profitability through the Great Recession, despite the challenging economic environment. However, the owners believed that, with the input of external capital, Lawn Doctor could drive growth at an even greater rate, by broadening its geographic footprint and increasing its support for current franchisees.
- The owners were referred to us by a prior client, whose company we had sold a few years earlier. We engaged the owners for a number of years before they were ready to sell, regularly advising them on market conditions and how to best position their company.
Sperry Mitchell Solution
- We listen to the priorities of all company shareholders and produce results that meet those goals. Every sale transaction is like a jigsaw puzzle: the solutions are not always obvious. Rather, they slowly come into form with diligent work and patience. In this instance, the two shareholders had diametrically different goals. The majority shareholder was primarily focused on cashing out at maximum value. The minority shareholder/CEO also wanted to cash out, but was insistent on finding a buyer who would back his son in assuming leadership of the company, provide equity to the management team, and commit funds to turbocharge growth. After creating a robust market of both strategic and financial acquirers, we were able to find a private equity firm that both offered a premium valuation and bought into the wisdom of backing management while also investing in the business.
