ServiceMaster Completes Frontdoor Spin-off
The spin-off enables ServiceMaster to focus on its transformation efforts and on delivering an array of residential and commercial services ranging from pest control and janitorial cleaning to restoration services, through more than 8,000 owned, licensed, and franchised locations across its seven brands, which operate in more than 22 countries.
“Today’s announcement is a major milestone for our employees, shareholders and business,” said Nik Varty, chief executive officer of ServiceMaster. “ServiceMaster begins its next chapter with strong momentum and compelling growth prospects. We are committed to delivering best-in-class services, and to continuing the transformation efforts in our key Terminix business by focusing on our mission of helping maintain, improve, and protect our customers’ most important assets – their homes and businesses.”
“Operating as two powerful, independent, focused companies, ServiceMaster and Frontdoor can now each benefit from increased focus and flexibility to better serve customers, drive organic growth, and unlock significant long-term value for shareholders. I’m excited for the opportunities that lie ahead for both companies.”
In the last year, ServiceMaster has made significant progress in strengthening and repositioning its Terminix business by putting in place a strong leadership team, reinforcing accountability, empowering technicians to deliver an excellent customer experience, and working to implement a lean, Six Sigma approach. The company has also embarked on a journey to build a strong commercial pest control business, including the successful acquisition in of Copesan Services, and is implementing a renewed growth strategy for its Franchise Services Group.
The separation was completed through a pro rata dividend of Frontdoor common stock effective on October 1, 2018 to ServiceMaster shareholders of record as of the close of business on September 14, 2018 (the “record date”). Each ServiceMaster shareholder as of the record date received one share of Frontdoor common stock for every two shares of ServiceMaster common stock held by such shareholder on the record date. Shareholders will receive cash in lieu of any fractional shares that they would otherwise have received in the distribution.
ServiceMaster shareholders own more than 80 percent of the outstanding shares of Frontdoor common stock.
J.P. Morgan served as exclusive financial advisor to ServiceMaster and Wachtell, Lipton, Rosen & Katz served as legal advisor.