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Service Corp. International said it will sell 536 funeral homes and cemeteries after the hundreds of acquisitions it made to become the world’s No. 1 funeral services company left it burdened with debt.
The company, which owns about 4,500 properties in 20 countries, including seven in Hawai‘i, declined to identify any of the businesses that are for sale, but said they are in 42 states in North America and in three Canadian provinces.
"We’re not releasing any list, or confirming or denying any locations for sale, just for competitive reasons," spokesman Greg Bolton said yesterday.
City Councilman John Henry Felix, chairman and chief executive officer of Service Corp.’s Hawai‘i operations, said he doubts that the Hawai‘i operations, which are profitable, are part of sale plans.
Houston-based Service Corp. owns Borthwick Mortuary in Honolulu; Hawaiian Memorial Park Cemetery and Greenhaven Memorial Park in Kane‘ohe; Valley Isle Memorial Park and Borthwick Mortuary Bulgo’s/Norman’s in Wailuku, Maui; Borthwick Mortuary in K¯loa, Kaua‘i; and Borthwick Hawai‘i Funeral Home in Hilo and Kona.
Service Corp. bought the Borthwick group in 1993 from Felix and John Farias. In 1996, the company raised antitrust issues when it instituted an unsuccessful hostile bid for rival The Loewen Group, which owned six Hawai‘i mortuaries at the time and has since filed for bankruptcy and put its Hawai‘i properties up for sale.
Service Corp. said it expects to receive $200 million to $250 million from the sale of the businesses during the next two years and will use the proceeds to pay down its debt.
Service Corp. went on a buying spree in the 1990s, spending billions in cash and stock in the so-called death-care industry. It bought 737 funeral homes in 1997 and 1998. By the end of 1998, the number of deaths per 1,000 people fell. Service Corp. sold fewer cemetery plots and said it paid too much for many of its acquisitions, putting the company deeply in debt.
The company said the businesses it is selling aren’t part of the company’s long-term growth plan. While they’re making money, performing 34,000 funeral services and 12,000 burials each year, they aren’t close to major population areas.
The businesses to be sold have combined annual revenue of $150 million, and earned $18 million before interest, taxes, depreciation and amortization, officials said.
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