Roto-Rooter Buys Assets of its Largest Independent Franchise Operator
CINCINNATI, Sept. 16, 2019 // PRNewswire // - Roto-Rooter Services Company, a wholly owned subsidiary of Chemed Corporation ("Chemed") (NYSE: CHE), announced it has acquired all of Hoffman Southwest Corporation's Roto-Rooter franchise operations for a purchase price of $120 million. Hoffman Southwest is Roto-Rooter's largest independent franchise operator. The acquisition means that Roto-Rooter takes over fourteen franchise service operations in the western U.S.
This is Roto-Rooter's largest franchise acquisition to date, with annual sales of $78 million. The franchised territories include: Metro Los Angeles (including Inland Empire, San Fernando Valley, San Gabriel County and Orange County) and San Diego, California; Dallas and El Paso, Texas; Phoenix, Tucson, and Florence, Arizona; Salt Lake City, Ogden, Park City and Provo, Utah; and Portland and Salem, Oregon. Collectively, these Roto-Rooter locations serve a population of approximately 32 million people.
Roto-Rooter CEO, Spencer Lee, said this acquisition was a long-term goal for the company. "Bringing these important western markets under company control allows us to leverage our proven internal operating systems, expand the list of services offered and grow our customer base. We will remain focused on providing the highest quality service to our residential and commercial customers in these new markets."
The deal closed effective September 16, 2019. This purchase is part of Roto-Rooter's ongoing strategy of acquiring franchises to boost productivity, market share and profitability.
Roto-Rooter was established in 1935 and is the largest provider of plumbing repair and sewer & drain cleaning services in North America. Roto-Rooter also provides water damage cleanup services in most of its locations. It operates businesses in 130 company-owned territories and approximately 400 franchise territories, serving approximately 91 percent of the U.S. population and 40% of the Canadian population. Roto-Rooter also has licensed master franchises in the republics of Indonesia and Singapore, and the Philippines. For more information about Roto-Rooter, please visit www.rotorooter.com.
Listed on the New York Stock Exchange and headquartered in Cincinnati, Ohio, Chemed Corporation (www.chemed.com) operates two wholly owned subsidiaries: VITAS Healthcare and Roto-Rooter. VITAS is the nation's largest provider of end-of-life hospice care and Roto-Rooter is the nation's leading provider of plumbing repair and drain cleaning services.
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