Oaktree Capital Management buys My Alarm Center

NEWTOWN SQUARE, Pa.—My Alarm Center, a national home security and automation provider based here, was recently sold to global investment firm Oaktree Capital Management, headquartered in Los Angeles. The deal closed on July 14.

“We kicked off an effort to recapitalize the business about a year ago, looking to strengthen our financial position, our balance sheet, and give us a better opportunity to grow our business,” Amy Kothari, My Alarm Center's president and CEO, told Security Systems News. The company ultimately decided to seek an “infusion of new cash equity and a complete refinancing of our debt.”

Kothari continued, “Through the deal [with Oaktree] we actually reduced our debt significantly, and we cut our interest rate even more significantly.”

My Alarm Center is Oaktree Capital Management's first investment in the security space, according to Kothari. In addition to Oaktree, a group of investors led by Ironwood Capital and Alcentra Capital Corporation also participated in the transaction and will become minority shareholders in My Alarm Center. My Alarm Center was previously backed by Norwest Venture Partners.

My Alarm Center plans to “invest a lot more in the company, in the growth plan, systems, tools, efficiencies, to help make everyone's jobs here easier and most importantly to be able to better serve our customers,” according to Kothari.

“We're just going to continue to do what we've been doing, with more resources and a stronger capital structure. The focus on accelerating growth really is going to come through our network of branches,” Kothari said. The company has been focused more on direct-to-consumer sales in the last five years, she noted. “We want to continue to build a scalable organic engine to drive sustainable recurring revenue growth in targeted markets.”

The company will also be competitive in its dealer program and with acquisitions. “Just because we've shifted to a much more organic focus doesn't mean we're abandoning those channels at all,” Kothari said.

“Since closing our deal with Oaktree … we closed three bulk acquisitions, added a major high-volume, high-quality dealer to our dealer program.” Kothari declined to release account figures of these deals.

My Alarm Center has 6 branches, about 183,000 accounts and more than $7.5 million in RMR.