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Who will buy AlarmForce?

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Tuesday, August 7, 2012

AlarmForce, a super-regional security company based in Toronto, announced that its board of directors is taking a look at selling the company. The company has hired Imperial Capital to help it with a possible sale.

The company's market cap value today is listed as $135m and its enterprise value is $119m.

I asked Richard Ginsburg, former CEO of Protection One who is now managing partner at G3 Capital Partners, what he thought about the sale of AlarmForce. He said he thought the company is well run and that CEO Joel Matlin "has done a fabulous job of identifying a segment of the market open to value-oriented products (like their new video offering) at prices that are at or lower in comparison to traditional systems with basic offerings."

Ginsburg also said he believes "a company like AlarmForce is in a great position to compete with the likes of industry leader ADT and the emerging cable and telecom companies because of [AlarmForce's] single-minded focus on enhanced services like two-way voice and now video services." He added that he believes "some of the traditional companies are in a weaker position to compete in comparison."

Ginsburg predicted the company will get "good interest"  and said Imperial Capital has "formed a great niche in the M&A sector so they are a good choice [to help out with a sale.]"

The last time I spoke to CEO Joel Matlin was back in the winter of 2010 when he was opening a fourth office in Minneapolis/St. Paul.It has offices in North Carolina (opened in 2005), Ohio (opened in January 2006)  and it opened an office in Georgia in 2007.

AlarmForce does security alarm monitoring, personal emergency response monitoring, video surveillance for resi and commercial customers. Something that’s unique about AlarmForce is that it manufactures and installs its own two-way voice home alarm systems. When I did that interview, AlarmForce had 103,000 accounts in Canada and the U.S., which Matlin told me was up from 56,700 accounts in 2006. Today the number of accounts is closer to 125,000.

“Canada is a tough country to do business in. It’s got a population the same as the state of the California, but it’s spread out over a country that’s much larger than the U.S.,” Matlin said. In addition to dense population centers that are easier to penetrate, “the perception of crime is stronger in the U.S. than it is in Canada.”

Wonder who some potential buyers might be? One possiblitiy, in my opinion would be Stanley, which expanded its resi business in Canada last summer with the purchase of Microtec Security Systems. It got 80,000 accounts and additional bi-lingual monitoring capability out of the deal.

Or I suppose AlarmForce could be a bolt-on for a telecom that’s getting into the security business. Rogers Communications maybe? Here’s a video from the summer of 2011 where we talk about Rogers Communications working (in secret!) with iControl to get into the security industry.  And here’s a story about the deal.

AlarmForce board of directors has formed a committee of independent directors to supervise the strategic review.

 

Stanley CSS names new executive

 - 
Tuesday, December 13, 2011

Stanley CSS on Dec. 13 named  Robert Branchaud, to lead its Eastern Canada district, which will encompass Stanley’s operations in Canada as well as the former Microtec Security Systems (AlarmCap.) Branchuad was a founder of a security company that he sold to Microtec in 2000.

Stanley acquired Microtec, the fourth largest alarm company in Canada in August. Here’s my report on that deal.  The deal also also included ULC approved and bi-lingual monitoring capabilities.

“The implementation of local, ULC and French speaking monitoring services, solidifies Stanley CSS as a major player in the Canadian security industry,” Branchaud is quoted as saying in a release. “Our advanced technology detects what region a customer is calling from before connecting him or her with an operator.  We are then able to identify the caller’s language and match the caller with an operator who can communicate most efficiently with the customer.  Stanley CSS’ commitment to doing business at a local level and focusing on outstanding service in the five customer touchpoints highlights their understanding and appreciation for the importance of individual service.”

Here’s some more information on Branchaud from the release.

“[He] is well known and highly regarded in the Canadian security industry. With over 30 years of experience in the industry, he founded three security companies, the most recent of which he sold the majority of interest to Microtec Enterprises, Inc. in 2000. Active in the Canadian security industry, Branchaud previously served as President of the Canadian Security Association (CANASA) for the Quebec division, received President’s Awards in 2005 and 2011 for his achievements with CANASA, and was the 2011 recipient of the R.A. Henderson Award in recognition of his exemplary leadership, years of dedication and significant contributions to the Canadian security industry.”