When Funeral Director Daily made our 2018 predictions, one that we made was that we thought Canadian funeral and cemetery operator, Park Lawn Corporation, would be aggressive in building its network of funeral homes and cemeteries in the United States. If you did not agree even when they made a purchase of approximately $US 50 million to purchase New York and New Jersey cemetery operator CMS Mid-Atlantic, you have to agree the newest move announced yesterday proves our point.
In a Park Lawn press release that you can read here the company announced the purchase of Signature Funeral and Cemetery Investments, LLC and the purchase of Citadel Management, LLC for an aggregate purchase price of $US 136.4 million in cash. The price works out to $US 123 million for Signature’s 30 properties (9 cemeteries and 21 funeral homes) and $US 13.4 million for Citadel’s 37 properties (8 funeral homes and 29 cemeteries). Signature’s properties are located in Texas, Kansas, Missouri, New Mexico, and Mississippi. Citadel owns their properties in North and South Carolina. According to the press release, at the prices listed, Park Lawn is paying 9.8 x EBITDA for Signature and 5.4 x EBITDA for Citadel.
Again, according to the press release, Park Lawn says that the acquisitions will be immediately accretive to earnings and in the near term over $3 million of synergies will be corralled. They also mention that “tuck in” acquisitions are very possible going forward.
Park Lawn Corporation now indicates that they own and operate 176 properties including cemeteries, crematoria, and funeral homes with a footprint covering 11 U.S. states and 5 Canadian provinces. At the end of the 2017 calendar year it is estimated that the company owned 89 properties.