G4S buys up ISS for £5.2bn

17 October 2011

International security business G4S has acquired Copenhagen-based facilities provider ISS in a £5.2 billion deal.

The move is expected to put G4S more squarely into the integrated FM market.

The company will be a global leader in integrated security and facilities services, combining G4S's 2010 revenue of £7.4 billion and ISS's 2010 revenue of £8.5 billion, according to a G4S statement.

The combination of G4S and ISS creates the world’s largest integrated security and facilities services company, by revenue, profit, countries of operation and number of employees.

London-listed G4S also expects to make “an estimated £100 million of annual pre-tax cost savings by 2014”.

G4S chief executive Nick Buckles said the company as been moving into markets outside that of security since its was created in 2004. “We believe this acquisition will transform our business, significantly accelerate the delivery of our solutions strategy and create substantial value for shareholders,” he said.

“G4S and ISS have very similar cultures and strategic ambitions as well as a strong, shared vision for providing service excellence to customers across the security and facilities services spectrum.  The acquisition will also provide significant opportunities for staff at all levels to develop and broaden their skills into complementary areas, as part of a team of more than one million G4S employees.”

ISS was founded in Copenhagen in 1901 as a small security company with 20 night watchmen and in 1934 it entered the cleaning business. It now has more then 535,000 employees globally.

It offers cleaning, property services, catering, support services, security services and facility management.

G4S, meanwhile, has more than 635,000 employees in over 125 countries.

The announcement comes after ISS earlier this year called off an initial public offering thought to be worth around £1.6 billion.

ISS is controlled by EQT, the private equity arm of Sweden’s Wallenberg family, and GS Capital Partners, the private equity unit of US bank Goldman Sachs. It bought the business in 2004 for £2.4 billion and has been looking to either sell off the company or float it.

Jeff Gravenhorst, chief executive of ISS, will be joining the G4S board.

Last November in an exclusive interview with FM World, Gravenhorst said the Danish global support services could float as soon as the first half 2011. The listing was “unlikely” to be in a stock exchange other than Copenhagen or London, or it could be in both, he said.

Other news for Tuesday, 18 October 2011

G4S buys up ISS for £5.2bn

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Irwin Mitchell outsources to OCS

Europa lands midlands outlet contract

Agents4FM rebrands to focus on responsibility

Hard but valuable lessons


BIFM Award 2011 winners by category:

Client of Year – The Co-operative (Highly commended: Everything Everywhere)

Consultant of the Year – EC Harris

Judges' Special Award - PriDE

Sustainability and Environmental Impact - Modus Services Limited

FM of the Year – Chris Stoddart scoops top prize at BIFM Awards

Overall Industry Impact – Lionel Prodgers

Innovation in Products – Plastic Surgeon

Service Provider of the Year – Westway Services (highly commended: SitexOrbis)

Innovation and Technology and Systems – SGP with Altius Vendor Assurance (highly commended: Serco for Forth Valley Royal Hospital)

Communications and Marketing – HSS Hire (highly commended: Liz Kentish Coaching and Managed Support Services)

Impact on Organisation and Workplace – Telefonica supported by ISS (highly commended: Balfour Beatty Workplace, BBC Workplace and ID:SR)

Innovation in Customer Service – Carillion (highly commended: Devonshire Square Management)