Park Lawn Proposes to Acquire Carriage Services
In a June 13, 2023 letter obtained by Connecting Directors, Park Lawn Chief Executive Officer J. Bradley Green writes that his company’s proposal “represents the best path forward for Carriage and carries strategic merits which are unmatched by any other alternative available to the Company.”
The proposal alludes to “recent industry trends following the COVID-19 pandemic” which “continue to put pressure on Carriage’s operating results and have a “compounding effect on the Company due to its highly levered capital structure and the rising interest rate environment.”
Principal terms of the proposal include the acquisition of “all of the outstanding equity of Carriage for $34.00 per share in cash, representing a 25% premium” to the weighted average share price as of June 12. Timing, due diligence requirements, and necessary approvals are also detailed in the letter.
Park Lawn’s most recent press release, announcing its acquisition of “substantially all the assets of Cobb Funeral Chapel and Cobb Suncrest Memorial Gardens” in Moultrie, Georgia, states that as of the release date of June 26, 2023, the Toronto-based company and its subsidiaries “own and operate businesses including cemeteries, crematoria, funeral homes, chapels, planning offices and a transfer service” in three Canadian provinces and nineteen U.S. states.” Park Lawn’s U.S. headquarters is located in Houston.
According to Carriage Services’ website, the company, “a leading provider of funeral and cemetery services and merchandise in the United States,” operates 173 funeral homes in 26 states and 32 cemeteries in 11 states. The company was founded in 1991 by Mel Payne, who reportedly suffered a stroke in February while recovering from knee surgery; he was expected to make a full recovery after rehabilitation.
On June 22, 2023, Carriage Services announced that Payne had stepped down as Chief Executive Officer, but was assuming the role of Executive Chairman of the Board of Directors. Carlos R. Quezada was named CEO, and Steven D. Metzger was appointed as President.