Priority One acquires one, has dry powder for more

Closes $10m revolver with CapitalSource
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Thursday, April 21, 2011

GREENVILLE, S.C.—Fueled by a new $10 million line of credit from CapitalSource, Priority One Security, a full-service security company based here, completed one acquisition and has plans for more growth.

“Our intention is to saturate the South Carolina coast,” Bill Francis, Priority One president and founder, told Security Systems News.

Priority One on April 18 announced the acquisition of Orangeburg Security. In business for 15 years, Priority One specializes in home security, home automation and “the usual commercial CCTV, card access and integrated technology,” Francis said. It has an 80-20 mostly residential mix. On the commercial side, it does “everything from small businesses to the anything major. The largest job we’ve done was $800,000,” he said.

With the addition of Orangeburg Security, a primarily residential company, based in Orangeburg, S.C., Priority One has 12,000 accounts, will have 45 employees and do about $9 million in annual revenue. In addition to its office here, Priority One has a satellite office in Charlotte, N.C. It will keep the Orangeburg office. The company’s footprint is concentrated around Greenville, S.C. and Charlotte, N.C.

It is using some of its new $10m revolver to “hire 10 to 15 new employees ... to help us expand our territory throughout the state of South Carolina,” Francis said.

John Robuck, CapitalSource director of security finance, said, “The nice thing about the ways this loan is structured is that there’s no scheduled amortization.” He said that Priority One “can repay and borrow again as they see fit, which helps companies weather fluctuations in working capital.”

He said companies who receive loans “are required to report certain things ... but they can go out to a target and position themselves very well. They have the capital ready to deploy. They can say, ‘Let’s agree to terms and move ahead with this acquisition.’”

Francis said Priority One plans to grow organically and through acquisitions. “We have another acquisition we hope to close within the next few months.  We feel young and rejuvenated. We’d always done loans through conventional banks. CapitalSource is teaching us a new way to do business and we like it,” Francis said.