Commercial Cleaning Systems, Inc. (“CCS” or the “Company”) is one of the largest independent providers of commercial janitorial services in the Western U.S. Scorpion Capital Partners (“Scorpion”) acquired a majority stake in the Company in 2006.
FocalPoint was engaged by CSS to evaluate its strategic alternatives and ultimately guided them through a sales process. CSS was acquired by Invision Capital.
Between 2006 and 2010, CCS implemented an aggressive growth and expansion strategy, making several acquisitions of various regional janitorial service providers. Intense price pressure in the wake of the financial crisis, the uncertainty of health care reform, increased workers compensation expenses and the impact of unionization in certain locations created significant operational hurdles for the consolidated Company. Early in the process, as a result of the impending maturity and potential covenant defaults under its current credit facility, the Company received a reservation of rights letter from its current lenders. Due to continued consolidation in the space, several large strategic buyers lacked the capacity to participate in the process, narrowing the field of qualified bidders to a select group of financial sponsors.
FocalPoint ran a comprehensive marketing process and, at the request of the Board of Directors, FocalPoint evaluated the Company’s strategic alternatives including a sale of the company, restructuring of its current debt, and a restructuring of the balance sheet.
The sale process resulted in several offers and FocalPoint and the Company negotiated with the existing bank group to roll over a large percentage of its debt. Invision Capital was chosen as the prevailing financial sponsor. In order to effect the transaction, FocalPoint built consensus between multiple stakeholders including the management team, the board of directors, Scorpion, the current bank group and the new financial sponsor (Invision Capital). FocalPoint spearheaded the negotiations and successfully closed the transaction at a premium valuation.
Commercial Cleaning Systems has been acquired by Invision Capital
FocalPoint served as exclusive financial advisor to Commercial Cleaning Systems
“The team at FocalPoint was professional in every aspect of the transaction and helped us achieve the best possible outcome by negotiating and building consensus among multiple stakeholders. Partnering with Invision, who shares management’s business philosophy, will enable the Company to execute its growth objectives and navigate forward with the full financial resources of a sophisticated and experienced financial partner. We are looking forward to working with Invision Capital and leveraging their janitorial industry expertise.”
CEO, Commercial Cleaning Systems