Foundation Partners adds locations

In a press release issued last week Foundation Partners Group announced that it had purchased a group of funeral and cremation operations.  The group consists of three business, that were owned by one party,  known as Advent Funeral and Cremation Services with locations in Falls Church, Virginia, and Lanham, Maryland.  Also included in the purchase was Rapp Funeral Service in Sliver Spring, Maryland, and Chesapeake Crematory in Beltsville, Maryland.

You can access the Foundation Partners press release here.

According to Foundation Partners, the excursion into Maryland will mark its expansion into its 20th state of operation.

Again according to the press release, “Advent specialized in offering the simpler, more individualized life celebrations preferred by families today – whether cremation or burial.  In recent years, the company purchased Rapp Funeral Service and Chesapeake Crematory, while at the same time expanding into other funeral businesses including an online solution for direct cremation and pet cremation services.”

Here is the Advent Funeral and Cremation Services web-site.

Funeral Director Daily take:  This marks the second announcement of a corporate acquisition in the Greater Washington, DC market in the past week.  Last week Carriage Services announced the acquisition of Fairfax Memorial Park and Funeral Home, which they also announced was their largest ever acquisition.

We don’t see that as a surprise as funeral home acquisitions, for the large funeral and cremation operators,  are becoming less about historical numbers and more about gaining a foothold with a brand name in large demographic areas in order to grow numbers of calls.  And, the Greater Washington, DC market is the 6th largest in the country with over 6 million people and growing with an  almost 11% decadal growth rate.

In our opinion, historical numbers still matter, but we see a trend emerging whereby it may be more cost effective, especially in a day of less heritage firm loyalty, for large operators to purchase a smaller brand name in a community and market that brand for increased call numbers.  Also, in a day of increasing options for consumers, that brand may represent a growing trend for type of memorialization away from what a historical leader may be perceived as offering.

In any regard, we do see the cost to acquire, via a multiple of EBITDA being challenged by the cost to build call numbers, by brand name.  We think that perspective will continue to grow as acquisitions keep getting more expensive.

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