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Servest eyes further growth as it unveils second acquisition in a week

PUBLISHED: 06:30 02 November 2016 | UPDATED: 15:43 02 November 2016

Servest chief executive Rob Legge. Picture: Gregg Brown.

Servest chief executive Rob Legge. Picture: Gregg Brown.

East Anglian facilities management firm Servest has set its sights on hitting £1bn in revenue, as it today announces its second major acquisition in a week.

The deal to acquire Staffordshire-based Catering Academy will bolster the company’s presence in educational catering and comes just days after it bought contractor Arthur McKay to expand its building services footprint.

And group chief executive Rob Legge said Servest, which employs more than 3,500 people across Norfolk and Suffolk, has plans to continue growing through acquisition – including in the US – as it looks to close the gap on industry giants such as Serco, Carillion and G4S.

“They have the size and the ability to compete for contracts coming out of central government and local authorities. Our strategy is to compete and win at that level, and the only way we can do that is to grow the service lines that we have,” said Mr Legge.

The company has identified education as a growth area and sees £33m-turnover Catering Academy as a way in to schools, colleges and universities.

“The government message is that you have to feed children properly – hot meals and healthy living – so we see that growing,” said Mr Legge.

“There will be another acquisition next year, though we can’t yet say what.

“At any one time we have half-a-dozen deals on the table, and there’s one that’s getting warmer.”

The company is also monitoring the potential of the US market, and expects to make a move next year.

“We’ve already looked at businesses over there,” said Mr Legge.

“Their facilities management landscape is very different – very siloed – so I think a UK business could do very well out there.”

The acquisition of Arthur McKay, which specialises in mechanical and electrical services, takes the group’s building services revenues from around £35m to £160m.

Together, the two deals have taken Servest’s UK turnover close to £500m, making it bigger in size than its South African parent company.

Mr Legge said Servest was aiming for “sustainable, targeted, organic growth” and viewed post-Brexit uncertainty as an opportunity, with more companies expected to look to outsourcing to cut costs.

The company began recruiting for 50 new employees at its call centre in the summer and anticipates creating around 100 more jobs in the next two years at its Bury St Edmunds headquarters, which it wants to move to a larger site.

It has also launched a new coffee brand, Groundhouse, which it hopes will establish a presence on the high street and across its other sites.

Servest is a member of the EDP/EADT Top100, a list of the biggest companies in Norfolk and Suffolk by turnover.

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