Exit and Growth Strategies for Middle Market Businesses

M&A News In The Business Services Industry Sector

By Brad Purifoy | Nov 08, 2018

The report below gives a good overview of the fourth quarter M&A activity in the Business Services Industry Sector. M&A activity for North American based target companies in the Business Services sector for Q3 2018 included 256 closed deals, according to data published by industry data tracker FactSet.

One of the notable middle market transactions closed in August when Intertek Group Plc acquired Alchemy Systems LP, a portfolio company of Riverside Partners LLC, for US$480 million in cash. The deal was funded through Intertek Group Plc’s cash and debt facilities. The transaction would allow Intertek Group Plc to expand its assurance services into food and retail industry. Founded in 2003, Alchemy Systems LP is located in Austin, Texas and provides workforce training, coaching and communications programs to food companies.

Business process outsourcing, which can be a cheaper and more effective option for many businesses, continues to grow as emerging markets like India and the Philippines offer cost-effective alternatives to full-time employees.

Industry Indicators

  • US corporate profits, an indicator of corporate demand for business services, rose 7.7% in the second quarter of 2018 compared to the same period in 2017.
  • The value of US nonresidential construction spending, a driver for business services demand, rose 3.5% year-to-date in July 2018 compared to the same period in 2017.
  • Total US revenue for administration and support and waste management and remediation services rose 9.4% in the second quarter of 2018 compared to the previous year.

Posted by Brad Purifoy.

Read the Entire Business Services 4th Quarter Newsletter Here

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