Deal Type

Sell-side transaction

Deal Team

Chris Rowe, Andrew Allred and John Kirkland

Company Overview

Tree Worx is a labor of love for owner Hannes de Wet, who followed his passion in 2013 to found the company in Chattanooga, Tennessee. Over more than a decade in business, de Wet grew Tree Worx from the ground up into a muti-million dollar business. Boasting a team of highly skilled arborists and a fleet of the industry’s most cutting edge equipment, Tree Worx has earned a stellar reputation as Chattanooga’s premier tree service provider. Comprehensive services include tree removal, trimming, planting, plant healthcare services, full-property tree care plans, tree hazard assessment, deep root soil care programs, disease and pest management, and building clearance plans for residential and commercial clients. 

Situation

With an eye on growth and expansion, de Wet took notice when private equity firms began to take an interest in the residential tree trimming industry. Determined to capitalize on momentum and accelerate the company’s growth, de Wet turned to FourBridges Capital to explore the possibility of partnering with a private equity firm.

Challenge

When FourBridges stepped in to advise Tree Worx, the company already had an open dialogue with a potential buyer who was in pursuit of purchasing the business. FourBridges was faced with quickly introducing additional buyers and catching them up in order to create a more competitive process that would benefit the seller. This involved keeping the original buyer in the mix while quickly building a financial model, drafting marketing materials and shopping the deal to other investors in order to solicit LOIs from all interested parties simultaneously.    

Process

FourBridges’ accelerated process to quickly analyze financials and create evaluation materials to attract additional buyers paid off. The firm successfully introduced three additional buyers into the process, which created a more dynamic and competitive sales process. The LOIs from the parties that FourBridges brought into the process included a meaningfully better offer that allowed the firm to push the offer from the original suitor higher. Once the best investor was ultimately identified, FourBridges helped guide the seller through diligence to an expedient closing.  

Results

As a result of the competition that FourBridges successfully introduced, both the price and terms of the offers improved, increasing the enterprise value of Tree Worx by around 10%. In addition, FourBridges helped identify the best-fit investor who could help accomplish the seller’s goals of accelerating growth and providing an attractive upside through rolled equity while preserving the company’s culture and workers. 

Tree Worx’s well-capitalized partnership with Boutte Tree and North Branch Capital brings strategic and financial resources to support the company’s continued growth and expansion. De Wet will continue to run daily operations out of Chattanooga, but will offload administrative and back-office tasks in order to increase his focus on strategic growth initiatives, including mergers and acquisitions and expansion into new markets.