ADS acquires two in Alabama

The two buys are ‘just the start’ of ADS’ acquisition plans for 2014
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Wednesday, March 5, 2014

NASHVILLE, Tenn.—ADS Security, based here, this week announced the acquisition of the accounts of two Alabama security companies, Advanced Electronic Solutions of Opelika, and Guardian Security Systems of Decatur.

“This adds over 1,200 customers to our Alabama base,” Patrick Ritter, ADS VP/controller, told Security Systems News. “We have now surpassed the 20,000 customer mark in Alabama, a state that we have had a presence in since the early 90s.”

The acquisitions, which involved mostly residential accounts, also bring two brick-and-mortar offices to ADS in that state.

“Guardian Security Systems had an existing office in Decatur, Ala., where we already had a large presence but did not have a physical location,” Ritter explained. “So we will be operating out of the Guardian facility in Decatur, Ala., as well as from the Advanced Electronic Solutions’ office out of the Auburn-Opelika market. We already had about 1,400 customers in that region of Alabama and this allows us to have the critical mass that we need to support an office location.”

These two buys are “just the start” of ADS’ acquisition plans for 2014, Ritter said. “We have a strong pipeline of acquisition candidates. We plan to close several other acquisitions this year.” He added that ADS plans to “pursue new markets as well as existing markets for fold-in opportunities.”

Ritter said Advanced Electronic Solutions and Guardian Security have the characteristics ADS looks for in an acquisition.

“Guardian Security was in business for over 25 years in the Decatur market and had a well-seasoned, low-attrition account base with many customers already using advanced services such as Honeywell’s Total Connect. It was about 60 percent residential,” Ritter said.

He said that ADS has had “a longstanding relationship with Ron Beasley, the owner of Guardian Security. … We actually monitored most of his customers for many years and had a great working relationship with him and knew that someday he would become part of ADS.”

In the case of Advanced Electronic Solutions, which was 90 percent residential, Ritter said that owner Chuck Wright “was someone who had heard about ADS’ great reputation throughout the Southeast, acquiring companies and taking great care of customers and that we really want the owner and the employees to become part of the ADS team long term, and Chuck actually reached out to us through a mutual friend.”

The owners of both companies and their teams will join ADS, adding six employees to that company. “It’s very important to us that the owners and the team come along with the account base. That allows us to keep continuity with the local operations with the people that the customers know,” Ritter said.

And the two companies’ customers will have “access to ADS’ top-notch customer care team, advanced suite of security services including mobile management and home automation technologies, proprietary UL-listed, CSAA Five Diamond Central Station, and My ADS online customer portal with simple account management and bill pay,” the news release said.

Ritter declined to discuss terms of the deals.

ADS, established in 1990, has more than 70,000 customers in seven states in the Southeast: Tennessee, Kentucky, Alabama, Mississippi, Georgia, South Carolina and Florida.

Ritter said revenues in 2013 were nearly $36 million, up 6 percent from 2012. RMR currently is $2.25 million, up from $2.09 million at the end of 2012, he said.

ADS is active on the acquisition front as part of a measured growth plan.