Over 12 disaster recovery companies on Danish group's hit list

Danish facility services giant ISS has drawn up an acquisition wish list of UK disaster recovery and facilities companies, according to sources.

The beauty parade consists of most of the smaller players in the market such as Rainbow, Chem-Dry, Total Damage Management, Disaster Restoration Ltd (DRL) and Restorex. It is understood talks between ISS and many of the companies have taken place over the past few weeks.

The US parent of Servicemaster UK and DRL had serious negotiations with ISS chief executive Eric Rylberg but the talks broke down.

"In both cases, the companies found that their interests did not coincide and the deal wasn't worth it," said the source.

A DRL spokeswoman said: "We have no intention of selling the company. In fact we are looking to expand. On ISS specifically we are not prepared to comment."

Servicemaster UK also declined to comment on the rumours.

Last year ISS's UK Damage Services was boosted by two acquisitions in December, Skipton-based Electromec and Staffordshire-based Ark and General. At the time, ISS Damage Services managing director Rodger Arneil said he would be focusing on international growth, but it is understood he is keen to consolidate its UK position.

The UK disaster recovery market in general has been suffering price cutting in an extremely competitive market. Industry sources said strategic alliances and a wave of consolidations among the smaller companies was inevitable.

A spokesman for the British Damage Management Association (BDMA) said: "The additional pressure to cut costs to the minimum also raises concerns about the potential erosion of quality standards which is, of course, central to the BDMA's remit and something we shall be monitoring."