Fidelis Contract Services — Acquisition by REACT Group plc
Birmingham-based commercial cleaning, hygiene and facilities-support business acquired by REACT Group plc, illustrating how substantial recurring contracted revenue, diversified customers and a scalable platform can support a valuation towards the upper end of the commercial cleaning SME range.
Acquirer
REACT Group plc
Year
2021
Maximum Consideration
£4.75m (max consideration)
Revenue
Not disclosed
Adjusted EBITDA
FY2022 basis
EBITDA Multiple
4.75×
Industry
Commercial Cleaning & Facilities Services
Transaction
In March 2021, REACT Group acquired Fidelis Contract Services, a Birmingham-based commercial cleaning, hygiene and facilities-support business serving customers across England and Wales. Fidelis had a highly recurring revenue model, with approximately 87% of FY2020 revenue recurring and a significant proportion generated from contracted maintenance cleaning. Its contracts were typically three to five years in duration, with no individual customer accounting for more than approximately 8% of revenue. The acquisition included initial consideration of approximately £1.7m plus performance-linked deferred consideration, with maximum total consideration of £4.75m. The transaction terms valued the business using a 4.75× FY2022 EBITDA multiple, on a cash-free, debt-free basis with normalised working capital.
Why the Premium?
- Approximately 87% recurring revenue
- Three to five-year contracted maintenance cleaning
- No single customer exceeding ~8% of revenue
- Diversified customer base across England and Wales
- Scalable operating platform
SME Takeaway
Fidelis Contract Services' revenue fell within the SME Multiples $1–$50M benchmark. The transaction provides a useful real-world benchmark for an established commercial cleaning business with substantial recurring contracted revenue. The 4.75× EBITDA transaction multiple demonstrates how long-term contracts, diversified customers and a scalable operating platform can support a valuation towards the upper end of the commercial cleaning SME range.
Disclaimer: Case study figures are based on publicly available information and are provided for illustrative purposes only. Transaction values, EBITDA figures and implied multiples may reflect different reporting periods, definitions and deal structures, and some multiples are calculated from disclosed figures rather than reported by the parties. They are not formal valuations, investment advice or a substitute for independent professional advice.