SPECIAL TO CONTRACTOR

DOWNERS GROVE, ILL. — In a little-noticed Securities and Exchange Commission filing on Nov. 4, 2005, ServiceMaster Corp. said it was thinking about selling its American Residential Services and American Mechanical Services operations.

The long-overlooked filing was first reported Jan. 2 by Crain's Chicago Business magazine.

In what may be a related development, Albert Cantu, who headed the operation, was forced out as president of ServiceMaster Group in mid-December. Cantu also oversaw the firm's janitorial and household cleaning operations.

The ServiceMaster operations were ranked as the third largest mechanical contractor in the nation in CONTRACTOR's 2005 Book of Giants with revenues of more than $ 690 million (May 2005, pg. 28).

Crain's reported that the ARS/ AMS unit, which also includes the Rescue Rooter plumbing business, has profit margins of about 1%.

ServiceMaster CEO Jonathan P. Ward told an interviewer on the CNBC cable network Nov. 3 that the plumbing and HVAC operations were not for sale. A day later ServiceMaster Senior Vice President and General Counsel Jim L. Kaput said in an SEC Form 8K filing that Ward's comment was not exactly correct.

"On the CNBC segment 'Closing Bell' on Nov. 3, 2005, Jonathan Ward of The Service-Master Co. ... was asked whether two of the businesses of the company, American Residential Services and American Mechanical Services, are ' on the block,'" the filing states. "Mr. Ward responded by stating, '[N]one of our companies at this point are quote, unquote on the block.' Mr. Ward's response was incomplete. Mr. Ward should have added, 'While no decision has been made, as part of its regular portfolio review process the company has been and continues to explore strategic alternatives with respect to American Residential Services and American Mechanical Services, which among other alternatives could include a sale of all or a portion of those businesses.'"

Cantu is the son of Carlos Cantu, who was CEO of ServiceMaster from 1994 to 1999. ServiceMaster explained the departure with the "pursue other interests" reason, but Cantu issued a statement that his departure was involuntary. He said in the statement that he has had longstanding disagreements with top executives over the direction of the company and that he planned to take his complaints to the company's board of directors.