ServiceMaster in play, stock surges 10%

True, it's not very exciting: lawn care and pest control. Nonetheless, it's a big business for ServiceMaster Company (NYSE:SVM). And in fact, shareholders got some excitement today as the stock price surged 10% to $13.14.

Well, the company announced it has retained Morgan Stanley and Goldman Sachs to "explore strategic alternatives." Yes, that's the buzz-phrase for when a company wants to sell-out.

Actually, ServiceMaster would be a great candidate for private equity buyers. The company, after all, has strong brands, such as Merry Maids and Terminix. Also, revenues are growing at a decent rate and the company generates significant free cash flows.

Back in May, the company's CEO, Jonathan Ward, left the company. Ironically, he now leads the Chicago office of Lazard investment bank.

Today, ServiceMaster also had an investor presentation, which was fairly extensive. In other words, it certainly looks like ServiceMaster is very serious about enhancing shareholder returns -- and soon.

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates InvestorOffering.com.