Mitie’s Acquisition Of Interserve Will Be A Step Forward For The Digitization Of The UK Facilities Services Sector

Mitie’s Acquisition Of Interserve Will Be A Step Forward For The Digitization Of The UK Facilities Services Sector

On December 1, 2020, UK-headquartered Mitie announced that it had completed the acquisition of Interserve’s facilities management business for £120 million in cash. The deal will expand Mitie’s footprint in the UK, particularly across the public sector where Interserve has facilities management contracts in place with departments including the Ministry of Defence and the NHS. The deal will grow Mitie’s annual revenue from £2.2 billion to £3.5 billion.

This deal follows a slew of acquisition activity in the UK facilities management sector, as services firms use M&A to build national coverage and benefit from economies of scale. Recent deals include facilities services firm Bellrock acquiring Fasset Holdings, FME Property Solutions and Naples Group, then Maxim Facilities Management buying Total Facilities Management Ltd. In November 2020, global facilities services firm BGIS bought UK-based M&E services firm Optimum Group Services. 

One interesting aspect of this latest deal is that Mitie plans to extend its investment in digital technologies across the broader Interserve client base. In recent years, Mitie has been building out its digital capabilities as part of Project Forte, a two-year programme which aims to improve its delivery of technical services, with the ambition of becoming the 'Amazon of FM'. As part of this, Mitie has been rolling out the latest Maximo CAFM system to enable faster and more accurate client billing. It is also implementing Accruent’s IoT platform so that it can remotely monitor client buildings, then use asset data to support a 20% reduction in reactive work orders and 95% accuracy in predictive maintenance calls. 

The Mitie-Interserve deal will be a step forward for the digitization of the UK facilities services sector, which as a whole has been slow to adopt technologies such as analytics, IoT devices and mobile apps. Customers will also benefit from Mitie’s ambitious technology vision which is to use data and analytics to aid smarter asset maintenance and better visibility into service delivery. For future-looking insights into the digitization of the facilities services sector, read our report Digitization Of Facilities Management Services: Predictions For The Future.