“The company’s attractive business model and growth potential made it appealing to private equity buyers.” . . That’s one of the three bullet point remarks about the proposed Park Lawn Corporation sale made at the beginning of this piece by Sandpiper Investment Research that was published Wednesday, June 12 by Seeking Alpha.

 

Here’s a couple of other points that Sandpiper Investment Research offers in their article titled, “Park Lawn:  When the Acquirer gets Aquired”:

 

• “. . . this is a big win for Park Lawn shareholders. In my most recent article on the company, I (Sandpiper Investment Research) noted that Park Lawn was trading below its U.S.-listed peers. . . “

 

• “Park Lawn’s business model offers up several key attributes that make it attractive to private equity. Firstly, the death care industry offers steady, predictable, and re-occurring revenues.”

 

• “Secondly, another factor is that makes the business model attractive is the ability to lever this business up with debt. Because it’s a predictable business, funeral homes can access bank debt and capital markets with a low cost of capital, thereby making most targets work with a lower cost of debt. . . “

 

• “With the Board unanimously agreeing that the transaction is in the best interests of shareholders and the large premium of 61%, it’s likely this deal will go through.”

 

Funeral Director Daily take:  I don’t know if I would conclude my thoughts on this proposed acquisition the same as the author of the article did, however, that’s what is great about free speech — everybody gets an opinion and if you are willing to put that opinion forward — some will agree and some might disagree.

 

It’s been almost two weeks since the announcement was made on June 3 and, at least publicly, we have had no other offers go out to Park Lawn Corporation.  That’s not to say that there may be others out there making private offers or starting to kick the tires before the July 29 deadline for this deal.

 

The acquisition of a 250-unit Death Care operating unit is big news in the funeral home and cemetery world.  It would really surprise me if someone else does not look at Park Lawn Corporation with an idea of how the acquisition of it could be of value to them in the future.

 

In the meantime it is just fun to be on the sidelines of these deals and conjure up ideas of what could happen next.  For those of you that might have missed this news, here’s Park Lawn’s press release on such.

 

Enjoy the weekend!!

 

More news from the world of Death Care:

• Meyer Funeral Director of the Year.  KSAL.com (KS)
• Valley Businessman, funeral home owner, named to YSU trustees board.  The Vindicator (OH)
• What is Normandy American Cemetery?  PA Home Page  (PA)

 

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