ISS

M&A Activity • Jan 20, 2015

Copenhagen, 2015-01-20 12:31 CET (GLOBE NEWSWIRE) --
No. 1/2015

-- In line with its stated strategy, ISS acquires the UK, Ireland &
European operations of engineering firm GS Hall plc
-- Annual revenue of approximately GBP 72 million (approx. DKK 698 million) -
the majority of which is generated from longstanding large customers in the
UK
-- Enterprise Value of GBP 53 million (approx. DKK 514 million)
-- 780 employees, including engineers and technicians will transfer to ISS
-- The acquisition supports ISS’ strategy by expanding its technical services
self-delivery capabilities and in particular supplements the thriving
Integrated Facility Services offering in the UK

ISS, a global leading facility services provider, has acquired the UK, Ireland
and European activities of UK-based GS Hall plc, which is a leading technical
services company focused on mechanical and electrical engineering, energy
management and compliance.

“This is the right company in the right market at the right time for us,” said
Jeff Gravenhorst, Group CEO, ISS A/S.

“As previously stated, we will support our strategic progress by making
selective competence-enhancing acquisitions. This acquisition will strengthen
our ability to meet the increasing demand for integrated facility solutions
where technical services is an important and deciding component for the
customer in choosing the right partner. Furthermore, the acquisition will
enhance our offering in energy management which is an emerging demand from our
customers,” Gravenhorst added.

Enterprise value is GBP 53 million of which GBP 6 million is an earn-out to
potentially be paid during H1 2015, in whole or in part, depending on the
financial performance of the business. With EBITA margins in excess of 8%, the
current margins of GSH are above ISS average. The transaction will be funded
through existing debt facilities and does not impact expected dividend payments
from ISS for fiscal year 2014. The transaction is final and unconditional as of
today.

“ISS is a perfect fit for our business. This transaction will improve the
self-delivery of technical services within integrated facilities services
contracts and provide our colleagues with substantial opportunities for career
progression,” said Clive Clarke, UK & Ireland MD of GSH.

A market worth over DKK 1 trillion
Established in 1895, GSH has a rich heritage and a strong position in the
mechanical and electrical services market in the UK where it has focused on the
self-delivery of services to key accounts in, among others, the Business
Service & IT and Retail & Wholesale customer segments.

“GSH and its management team have an excellent strategic fit with our existing
UK IFS and technical services business and we expect to achieve both revenue
and cost synergies. A strengthened foundation in the UK will also facilitate
the scaling of technical capabilities across Europe, thus enhancing further
growth opportunities in our existing technical services business on the
continent,” said Henrik Andersen, Group COO of Europe, Middle East and Africa.

“Technical services is becoming a central part of integrated facility services
and the technical services market in Europe is estimated to be worth over DKK 1
trillion where customers increasingly look across borders and continents for
coverage. This transaction will provide good growth opportunities in this
market,” the Group COO added.

First major acquisition since 2010
ISS has not made any significant acquisitions since 2010 and during that time
has divested non-core activities equivalent to almost DKK 12 billion of annual
revenue or 16% of its total business.

“As outlined in connection with the IPO in early 2014, we have a business
strategy which includes selective competence enhancing acquisitions subject to
tight strategic and financial filters. One of our focus areas is technical
services and with its heritage, technical self-delivery capabilities, customer
focus, and ability to supplement our existing successful IFS and technical
services business, GSH is a good fit. Our initial discussions with customers of
GSH and ISS support this,” said Gravenhorst.

For media enquiries
Manuel Vigilius, Global Media Relations Manager, +45 3817 6404

For investor enquiries
Nicholas Ward, Head of Group Investor Relations, +45 3817 6251
Martin Kjær Hansen, Investor Relations Manager, +45 3817 6431

About ISS
The ISS Group was founded in Copenhagen in 1901 and has grown to become one of
the world’s leading Facility Services companies. ISS offers a wide range of
services such as: Cleaning, Catering, Security, Property and Support Services
as well as Facility Management. Global revenue amounted to DKK 78.5 billion in
2013 and ISS has approximately 515,000 employees and local operations in more
than 50 countries across Europe, Asia, North America, Latin America and
Pacific, serving thousands of both public and private sector customers. For
more information on the ISS Group, visit www.issworld.com.

ISS A/S, ISIN XS0253470644
ISS Global A/S, ISIN XS1145526585, ISIN XS1145526825