Benex, formerly known as Beneficial Exterminating, was acquired in April 2016. A family owned Fumigation Company Since 1990, Benex provides sub-contracted fumigation and heat services to a significant number of pest control companies in Southern California. Since the acquisition the new President and employees of Benex have worked tirelessly to grow and develop a solid larger business to business customer base implementing best practices and top of the line technology transforming the company into a world class Fumigation Company that can offer its customers brand protection in the form of kill insurance, job surveillance, and expedited paperwork delivery.
The company is committing significant resources into up to date equipment, monitoring and employment. Crews are equipped with modern monitoring equipment to deliver proper fumigation concentrations for each job, and the company has maintained a focus on quality control measures which it has trained its personnel on to ensure efficacy. Benex has enjoyed a stellar reputation for being the industry leader of fumigation companies in Southern California.
Products & Services
Single-family residential fumigation services are the majority of their daily work. Over the past decade, this Company has developed a market niche to successfully fumigate large commercial and multi-unit residential projects, which now averages 50 projects a year. In 2006, they received high praise and industry recognition for successfully completing the world’s largest fumigation of a commercial complex.
Benex services the following segments:
- Commercial Fumigation
- Residential Fumigation
- Specialty Fumigation
- Industrial Plants
- Restaurants and Hospitality
- Soft Scape and Foliage
Sources of Revenue
The business currently is the prime third party vendor to over 110 pest/termite companies from the Mexican border to Santa Barbara, California. Many of the name brand local B2C pest companies that advertise extensively are clients of BENEX. The company has recently launched heat treatment processes for clients who are willing to pay three times the cost for a non-pesticide treatment. This process is substantially more profitable and will add significant value to the company as this becomes more popular.
Investment Opportunity Catalysts:
We believed BENEX to be an ideal acquisition for these reasons:
- 25 year history in business
- Established client base
- Company provides a must have staple service with future demand guaranteed
- Termite eradication is required prior to the sale of residential and commercial property
- Company leads industry quality and safety standards in Los Angeles, Orange County, Riverside and San Diego
- Sustained profitability
- Company was sold quickly due to owner sudden death in April 2015.
- Extensive groundwork laid to expand into a significant region north of Los Angeles, cut short by operator’s death. Expansion potential is very realistic.
- Valuation of purchase was approximately 2x EBIDA with 46% being financed by seller. Investors are expected to enjoy a future ROI of +8% per year beginning in 2018
- Future growth potential is excellent. Termite infestation is a steadily increasing problem due to the aging of buildings and housing. The need for fumigation is foreseeable in the next 10-20 years and the company remains diligent on implementing new technologies when pertinent.
- This is a company we can manage and run well. It fits well within our areas of expertise and geographical local.