NXP, the largest supplier of business and cleaning products to the corporate and government sectors, has completed an agreement to purchase janitorial supplies firm The Service Company.

The deal will see NXP vertically integrate its local operations to include bulk manufacturing of environmentally conscious cleaning and hygiene products and increase its B2B customer base by thousands – including export markets in Australia and the Pacific Islands.

The Service Company is New Zealand’s largest mid-market facilities supplies firm. The company has a presence in Auckland, Wellington and Christchurch and supplies 20,000 product lines to a database of over 25,000 customers nationwide including fast-food restaurants, airports and cleaning companies and franchises.

Ian Jemmett, CEO of The Service Company, says while other competitive offers to purchase the company were on the table, NXP was the most well-aligned strategically.

He says the business has grown around 600 per cent over his 15-year tenure as CEO and demand for cleaning and hygiene products during COVID has seen budget targets exceeded by more than 180% in a single month.

“Like our own business, NXP has had significant growth – particularly in the past year as it has leveraged supply chains to become an essential service provider of cleaning products.

“While both organisations operate across different industry sectors, NXP’s strength is at a corporate and government level while The Service Company meets the janitorial supply needs of mid-market businesses across New Zealand

“Our manufacturing and distribution firm specialise in the production of environmentally accredited, white-label cleaning products which provides NXP with a number of opportunities to expand into new markets.

CEO of NXP Joe Taylor says the company and its South Island entity Proclean Reward, will operate as a going concern under existing branding and all of the company’s 40 employees will all remain with the company – including its managing director Ian Jemmett.

“Supply chains have become increasingly important in recent months and the ability to scale production of cleaning supplies at short notice is critical to the stability of businesses in our market as well as their customers.

“The Service Company is a highly respected supplier in its market segment and bringing it under the NXP group umbrella will help ensure not just continuity of supply but also allow us to expand our environmentally conscious cleaning product range,” he says.

Taylor says while facilities is the largest category for NXP, the acquisition of The Service Company will create a facilities and cleaning “powerhouse” for the local industry.

“The purchase of TSC marks the evolution of NXP from its origins as a ‘stationery company’ a decade ago, to the point where the facilities and kitchen category will now make up more than 60% of our revenue,” he says.

Taylor says the purchase agreement has been finalised and the deal will take effect from the beginning of December this year.

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