Michael Hatcher & Associates (MH&A) based in Olive Branch, Mississippi, has completed an acquisition of Green King through their lawn care division Master Lawn. With this acquisition Master Lawn’s residential customer count has increased by 233 percent. For the immediate future, the Green King brand will remain in use with Green King customers.
All of Green King’s assets, including staff, customers, equipment and financials are now owned and operated by Master Lawn. Green King’s founder, Greg Drumwright, says he received six different offers from parties wanting to acquire his company, but he held out for a deal with MH&A.
“Early on there was a good trust built between our leadership team,” says Russ Sneed, COO of MH&A. “I think he has the utmost respect for Michael and if you’re around Greg for a while he’ll go ahead and tell you two or three things that Michael has said to him that have stuck with him or several things that Michael has done to support him along the way.”
For years Master Lawn and Green King shared a similar geographic region. With the acquisition, it has expanded Master Lawn’s presence to Mississippi’s Lafayette and Tishomingo counties. Green King’s Olive Branch location will serve as a branch office for Master Lawn.
This is MH&A’s fourth lawn care expansion over the last four years. The first one was with Master Lawn, which they now use for their lawn care division name.
All 22 of Green King’s employees are joining Master Lawn’s existing 23 employees. There was no staff reduction with this acquisition.
MH&A CFO Trey Ball says they don’t have the employee capacity to accomplish all the new work they’ve acquired so it is crucial for them to onboard the employees from acquired companies and keep them long-term. He says it’s not just about having spray technicians, but also the managers, customer support team and strong sales team that keeps everything running smoothly.
“In our previous history we’ve just learned each time internally all the little fine details that you need to know to continue to make those acquisitions and transitions successful,” Ball says.
The average hourly wage will be adjusted for incoming team members. Sneed says by paying a higher wage they can reduce their turnover rate. He says they’ll continue to invest in their team with training, continuing education and acquiring licenses.
Master Lawn wants their technicians to interface with customers and be the single point of contact as part of their service delivery. Sneed says they pride themselves on the professionalized experience of the technicians and that carries a higher wage associated with it.
When the new employees come over to Master Lawn, they honor their tenure they earned at the acquired company and reward them with the relevant benefits.
“We know the value of that employee, and their experience they earned previously to whoever the target was when we did the deal,” Ball says. “We wanted to honor, whether it be one year or five years, with whomever that was at the time with our company benefits so we make those exceptions for them once day one starts on their new job.”
The company also offers employees a number of benefits including health insurance, life insurance, vacation days, holidays, personal recognition, and a pension through the Employee Stock Ownership Plan (ESOP). All of these offerings add up and matter to employees.
MH&A became an ESOP in 2009. President Michael Hatcher says that while ESOPs are complicated and a long play, they presented the best opportunity for an exit strategy.
“At that age in my career, I was looking downrange and forward-thinking about what our exit strategies are and some guys that were my peers at the time they said, ‘Well Hatcher you’re so young, why are you thinking about it?’” Hatcher says. “But it was just the way that I operate and run the business. Looking forward, the people have always been the most important thing to me. They’re our greatest asset.”
Hatcher says early on the employees didn’t truly understand the value of the ESOP.
“Over the years after they’ve seen those people that have been able to cash into their retirement account with the ESOP all of a sudden it’s become very real and those that have been with the company through all of those years have seen their ESOP value grow,” Hatcher says.
Because reoccurring revenue drives the greatest return, MH&A’s Master Lawn division is doubling down on their investment in lawn care service delivery in the Mid-South region. Their long-term plan is to invest in service delivery in surrounding states and communities outside of the Mid-South region, led by Master Lawn’s general manager Joey Steele.
“You want to buy something that has value inherently,” Ball says. “When you look at buying additional contractual revenue, that adds value to your current business and is something you can support and grow that benefits the entire company, the employees, the owners, from dividends down to the ESOP pension itself.”