Good morning dealmakers, it’s Obey Martin Manayiti here with the US edition of the Wire from the New York newsroom. The janitorial sector is re-emerging as an attractive target for private equity after sponsors paused post-pandemic to assess earnings stability. "There was a pause for a couple of years as private equity thought janitorial businesses were inflated," said Disha Mehta, a managing director at Houlihan Lokey. "Fast forward to 2025-26, the sector has emerged again as an essential service that is not going away." Key investors include KKR, GI Partners, O2 Investment Partners, Inspirit Equity, Veritas Capital, Birch Hill Equity Partners, Ares Management, and Black Rock. GI Partners recently invested in HES Facilities Management, a Knoxville, Tennessee-based provider serving educational institutions. Jeff Sheu, a managing director at GI Partners, noted schools must maintain facilities regardless of economic cycles, with square footage per student rising from 130 in 1999 to 180 in 2018.

Separately, Windjammer Capital plans to sell IPS Group, a San Diego-headquartered parking infrastructure provider, to Nayax. PE Hub reports growing sponsor interest in parking infrastructure businesses.