ABM Industries Inc.
) announced that its subsidiary Linc Network, LLC has acquired the
franchise operations of TEGG Corporation, an expansive network
delivering comprehensive electrical service and preventive and
predictive maintenance solutions to commercial and industrial
TEGG's franchise network though mainly concentrated in North
America, encompasses 19 countries. This will expand ABM's
international footprint, increasing its service network and in line
with the company's vision of becoming the global leader in
integrated facility solutions.
TEGG's franchisees offer guaranteed services with an extensive
list of features that include infrared thermograpy and ultrasonic
inspections, de-energized services and electrical systems analysis
and reporting. Over the past two decades, TEGG's franchisees have
ensured the protection of commercial and industrial facilities from
electrical system failures, electrical fires and resultant business
interruptions and property damage. Through the acquisition, ABM
will expand its electrical services to include electrical
preventive and predictive maintenance solutions.
The inclusion of TEGG's franchise network will also strengthen
ABM's new division, ABM Franchising Group. ABM Franchising group
includes Linc Network, one of the world's largest commercial HVAC
contractor networks, and GreenHomes America (GHA), a national
provider of home performance contracting.
The acquisition also includes the franchise operations of TEGG's
subsidiary CurrentSAFE. CurrentSAFE is a national, residential,
electrical, safety franchisor that will highly complement GHA's
ABM Industries' strategy entails growth through acquisitions.
The acquisition of Linc Group in December 2010 has benefited ABM
and given it a better growth profile. However, a significant
portion of Linc's revenues is generated by government contracts and
could be negatively impacted by reduced government spending on
outsourced services as well as payment delays.
We retain our Neutral recommendation on ABM Industries.
The quantitative Zacks #3 Rank (short-term Hold" rating) for the
company indicates no directional pressure on the stock over the
Headquartered in San Francisco, California, ABM Industries
provides engineering, janitorial, parking, and security services to
thousands of commercial, industrial, institutional, and retail
facilities across the U.S. as well as Puerto Rico, British
Columbia, and Canada. ABM Industries competes with privately held
ARAMARK Corporation, Central Parking Corporation and UGL Services
UNICCO Operations Co.
ABM INDUSTRIES (ABM): Free Stock Analysis
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