The takeover between security Group G4S and ISS has ended due to opposition from G4S’s shareholders. The deal was worth a whopping £5.2 billion ($8.2 billion) and would have given a combined revenue of £16 billion.
However, shareholders were not happy for the organisation to proceed with the deal, as £2 billion was needed from investors. The two companies would have overlapped in 40 different countries, which could have been quite costly at first. This news created a drop of 17 per cent in the share price.
During the acquisition both organisations, G4S and ISS were showing excitement towards the acquisition: Nick Buckles, Chief Executive at G4S expressed, “We believe this acquisition will transform our business, significantly accelerate the delivery of our solutions strategy and create substantial value for shareholders.”
Ole Andersen, Chairman of the Board at ISS expressed, “The combination of ISS and G4S is a good fit both industrially and culturally. Together they can increase their exposure to the significant growth opportunities in emerging markets and accelerate their efforts in the growing market opportunity for integrated facilities services. The corporate cultures complement each other and the highly competent senior management at both G4S and ISS will together create a strong and experienced team to lead the combined group.”
However, speaking earlier today about the deal coming to an end, Mr Andersen, stated: “In July [we were] approached by G4S proposing to combine our two companies. There was a strong industrial and commercial rationale in the proposal and therefore we pursued the opportunity. However, it became evident after the announcement of the potential combination that G4S’s shareholders would not support the acquisition, due to the size and perceived complexity of the deal against the current macroeconomic backdrop. As a consequence our owner has agreed with G4S that the proposed acquisition should not proceed and we should get back to running our separate businesses and pursuing our respective goals.”
So for now, both organisations will continue down their own independent paths. ISS offer services for commercial and residential properties, such as: catering, cleaning, gardening and pest control. Whilst Crawley based G4S offers security solutions for commercial properties in an array of different sectors, such as: corporate, financial institutions, government, industrial, retail, leisure and tourism etc.
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