Fortive (FTV) Acquires ServiceChannel for $1.2B; Provides Preliminary Q2 Results

Fortive Corporation ("Fortive") (NYSE: FTV) announced today that it has entered into a definitive agreement with Bayard Capital and Accel Partners to acquire ServiceChannel, a leading global provider of SaaS-based multi-site facilities maintenance service solutions with an integrated service-provider network. The acquisition will be subject to customary closing conditions, including regulatory approvals, and will be financed primarily with available cash. Fortive anticipates that the acquisition will close in the third quarter of 2021.

ServiceChannel was founded in 1999 and serves more than 500 enterprise customers in over 70 countries across the globe, while also maintaining an integrated network of more than 70,000 facilities maintenance service providers. ServiceChannel’s SaaS offering enables multi-site owner / operators to manage and automate the full lifecycle of workflows related to the maintenance and repair of their properties and related assets, including work order management, asset tracking, and service provider tracking. The Company’s differentiated data-driven platform, which combines software with a service-provider network, draws from millions of data points to intelligently match contractors with jobs, enhancing quality, cost transparency and efficiency.

James A. Lico, President and Chief Executive Officer of Fortive, stated: “We are very excited to announce the pending acquisition of ServiceChannel. This transaction is another great example of how we continue to use disciplined capital deployment to accelerate our long-term strategy across our segments. ServiceChannel fits extremely well alongside Accruent and Gordian, broadening our offering of software-enabled solutions for the Facility and Asset Lifecycle workflow. The Company’s high-growth SaaS platform, leading contractor network, rich data assets, and existing global footprint will add significantly to the long-term growth and profitability of IOS.”

Fortive expects ServiceChannel to generate approximately $125 million of revenue in 2021. The purchase price for the acquisition is approximately $1.2 billion and is expected to be funded primarily with available cash. Upon closing, ServiceChannel is expected to be an independent operating company within Fortive’s Intelligent Operating Solutions segment.

Tom Buiocchi, CEO of ServiceChannel, stated: “ServiceChannel has successfully established a leading position solving challenges for facilities owners and operators for more than twenty years, and has significant growth runway ahead of it. With a range of highly complementary assets, and significant resources to support future organic and inorganic growth opportunities, Fortive is the perfect partner to support ServiceChannel in the next leg of our journey.”

Credit Suisse Securities (USA) LLC served as financial advisor and WilmerHale LLP served as legal counsel to Fortive. Morgan Stanley & Co. LLC served as financial advisor and Gunderson Dettmer LLP served as legal counsel to ServiceChannel.

FORTIVE SECOND QUARTER 2021 PRELIMINARY RESULTS

Fortive also today announced that for its second quarter, 2021, total revenue growth is estimated to be approximately 25%, with core revenue growth of approximately 20%. Fortive also expects adjusted operating profit margin to be ahead of prior guidance.

James A. Lico, President and Chief Executive Officer of Fortive, stated: “We are incredibly proud of the strength that we demonstrated in Q2. These preliminary results, along with the acquisition of a high-quality company like ServiceChannel, puts us in a great position for the remainder of 2021 and 2022. We look forward to sharing more details on our earnings call on July 29th, 2021.”

CONFERENCE CALL

Fortive will hold a conference call tomorrow at 8:30 am ET. An accompanying slide presentation has been posted on the “Investors” section of Fortive website, www.fortive.com, under “Events/Presentations.” The call will also be available on Fortive’s website, also under “Events/Presentations.” A replay of the webcast will be available at the same location shortly after the conclusion of the presentation.

The conference call can be accessed by dialing 833-921-1644 (toll-free domestic) or 236-389-2654 (international); Conference ID: 5452344. A replay of the call will be available until July 20, 2021 via telephone starting approximately two hours after the call ends. Once available, the replay can be accessed at 800-585-8367 (toll-free domestic) or 416-621-4642 (international); Conference ID: 5452344 or visit the “Investors” section of the website under “Events/Presentations.”

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