ASG closes $230m line of credit

Goldman Sachs is new participant
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Thursday, February 3, 2011

BELTSVILLE, Md.—ASG Security closed Jan 28 on a new $230 million line of credit. Lead by ASG’s longtime banking partner, CapitalSource, this round also includes a new participant, Goldman Sachs.

Also participating in the round are previous investors: Bank of America, Citizens Bank, Madison Capital and PrivateBank.

“It gives us added capital to continue our growth strategy,” ASG CEO Joe Nuccio told Security Systems News. “There are a number of opportunities we’ve been looking at for a while, we expect a robust acquisition year in 2011.”

ASG moved into Oklahoma at the end of 2010 with the purchase of TNT, which it wants to use as a platform to expand its commercial business. Last week, ASG announced it would be making a big push in the resi market. Will acquisitions be resi or commercial focused?

It all depends on what ASG finds out there, executives said.

“Our goal has always been to create a lot of internal sales. We’ll use the revolver for key acquisitions that [provide access to] a new channel or a new market or enhance opportunities within our portfolio of branches,” Nuccio said.

The facility expands upon a $190 million facility completed in 2008. ASG is very happy to add Goldman Sachs to its bank group, said ASG CFO Ralph Masino. “For us it’s really exciting to have Goldman on board,” he said. “It’s important for us to have knowledgeable, experienced lenders who understand our space and have dedicated teams.”

Will Schmidt, who led the deal for CapitalSource, said it’s “a large deal with a lot of capacity, and it’s certainly due to the strong management team at ASG led by Joe and Ralph.” Schmidt called the company’s performance “top tier,” with impressive metrics. They’ve got “moderate attrition, good operating cash flow, strong market density—these guys do a good job,” he said.

Schmidt said ASG is very good at developing relationships within the industry and called them “the buyer of choice for many folks.” He said he’s “constantly impressed with the quality of companies they buy and they don’t have to enter into auctions ... or bid against a bunch of [other companies.] They continue to be able to find good fold-ins in [markets they’re in] or accretive deals in [neighboring markets],” he said.