India's IVFA backs ISS Hicare buyout
India Value Fund Advisors (IVFA) has partnered with Hicare founder A. Mahendran to acquire the pest control company from Danish multinational ISS Global. The deal, including primary growth capital, is worth INR2.5 billion ($39.7 million) and is expected to close next month.
ISS Hicare is currently India's second-largest pest control services provider according to IVFA. It operates across in 27 cities and serves more than 100,000 residential customers and 10,000 commercial customers.
The company was founded in 2003 by the Godrej Group and acquired by ISS Global in 2009. Mahendran built up the business when he was a managing director at Godrej.
IVFA will take a more than 80% stake in the business, a source familiar with the transaction told AVCJ. According to The Times of India, Mahendran will hold the rest, with the right to buy back shares if the company reaches certain performance milestones.
Hicare has an annual turnover of INR700 million. IVFA expects rising income levels and better awareness of health and safety issues to drive the home services segment. Demand in the B2B segment will be spurred by the expansion of key customer industries such as food, healthcare and commercial real estate, as well as by India's evolving regulatory requirements.
The PE firm will support the expansion of Hicare's branch network and the introduction of new services and products.
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