More “Private Money” is entering the Death Care business

December 4, 2024/Finance/

While it is all anecdotal on my part, what I’ve seen lately leads me to believe that there is plenty of money in circulation looking for investment and that some of that money will end up going into the Death Care sphere. I’ve noticed it for the last year by having private equity firms contact Funeral Director Daily looking for “purchase leads” and I noticed it in New Orleans when wandering the convention floor.

If you need any more proof here’s a short article from The Business Magazine of Great Britain announcing that investment management firm Downing is entering the funeral business and using their first acquisition to “. . . build a national network of funeral directors” as the Downing website, that you can access here, states.

Now, Downing is no small company. They have been in existence for almost 40 years, have over US$ 2.5 billion under management, and have offices in Sweden and Finland in addition to their base in the United Kingdom. That they have chosen to enter the Death Care field exhibits how many, outside of the field, view the profit potential moving forward.

In an article from Great Britain’s Funeral Service Times, which I cannot link because of a pay wall, here are some of the quotes given in relation to Downing’s first acquisition:

“Investment management firm Downing has completed its acquisition of Grassby and Sons, an established group of funeral directors across Dorset and Devon, for an undisclosed sum.”

“As a result, Downing has also established a funeral director-specific portfolio company, Lighthouse Funerals.”

“Downing’s decision to invest in the funeral sector comes as it believes it is growing and resilient, but also “a highly fragmented market that will benefit from consolidation”.

“Over the past five years, revenues in the sector (in Great Britain) have grown at a compounded annual growth rate (CAGR) of 5.3% to reach an estimated US$ 3.6 billion in 2024. As the UK population continues to age, demand for funeral services will increase.”

According to the Business Magazine of Great Britain article, the first acquisition by Downing (Lighthouse Funerals) was “Sixth-generation family funeral directors Grassby & Sons (which) was established as a stonemason in Dorchester in 1861. Since branching out into funerals in 1970, the business has expanded organically and through acquisition, and now operates eight funeral directors serving Dorset and East Devon.”

Here’s what one of their owners said in the article about aligning with Downing (Lighthouse Funerals), “The opportunity to play a pivotal part in Downing’s ambition to grow a high-quality group in the industry was the differentiating factor between the potential buyers, and we look forward to seeing Grassby & Sons playing a key role in the development of Lighthouse Funerals.”

Here is the Grassby and Sons Funeral Directors website

Tom Anderson
Funeral Director Daily

Funeral Director Daily take: My opinion is that Lighthouse Funerals will give independent British funeral directors another option when and if they choose to put their funeral homes on the market. My guess is that at least for the time being, with Dignity, Funeral Partners, and others in the market for “right-opportunity” growth, maybe it will become a real seller’s market in what is becoming a tough business segment in Great Britain.

And, for those in the North American markets, I think it is only a matter of time before a financial services, investment, or private equity company such as Downing makes this type of announcement on this continent.

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