Lennox International To Acquire Service Experts
Nashville, Tenn.-based Service Experts is expecting less-than-stellar third quarter results with earnings in a range of $0.10-$0.15 per diluted share. Its stock plunged nearly 40 percent in trading in July, the second major nose-dive to take place for the company this year. Service Experts has been an industry consolidator since 1996, and has 120 service centers operating in 34 states.
This is the second industry consolidator to be purchased this year. In March, ServiceMaster purchased American Residential Services, and folded it into its Rescue Rooter unit.
Lennox International reported its record third quarter income at $27.3 million, an 11 percent increase from the same time in1998. Sales for the quarter increased 26 percent to $669.1 million. The company reported diluted earnings of $0.64 per share.
The Service Expert agreement brings Lennox's total retail dealerships to more than 200, with annual sales revenues at more than $900 million. Lennox International sells in more than 70 countries worldwide, and is the parent company of Lennox Industries Inc., Armstrong Air Conditioning Inc., Heatcraft Inc. and Lennox Global Ltd.
On the day of the merger announcement, Service Experts' stock fell about 21 percent and its shares closed at $6, while Lennox's stock dropped nearly 25 percent with its shares at $10.