Securitas to buy Kratos' Public Safety and Security division for $70m

STOCKHOLM—Securitas has agreed to acquire the Kratos Public Safety and Security division from Kratos Defense & Security Solutions for approximately $70 million. Closing of the acquisition is subject to regulatory approval, and is expected during the second quarter of 2018.

Kratos Public Safety and Security, or KPSS, which has annual sales of approximately $135 million and employs 400 people globally, is to be combined with Securitas Electronic Security.

“It's an exciting time for Securitas and specifically Securitas Electronic Security (SES),” Tony Byerly, Securitas ES president, said in comments emailed to Security Systems News. “KPSS is an ideal acquisition for Securitas as it supports the global Securitas Electronic Security strategy and strengthens the company's electronic security platform. In addition, it is an important next step in the execution of Securitas' North American strategy to provide a complete range of protective services to the company's collective customer base.”

Byerly pointed out that the deal expands the company's national footprint in the U.S., adds highly skilled associates to the team, and opens new markets and opportunities for future growth. “Combining KPSS with SES creates a truly dynamic systems integrator in North America, and as part of Securitas' dynamic protective services portfolio we are well positioned in the market,” he said.

Kratos said in its press release that the deal is expected to “significantly improve” the company's overall financial position, while allowing them to develop “transformative, affordable technology” for the Department of Defense and commercial customers.

"The sale of PSS virtually completes the successful execution of Kratos' strategy to be a pure play defense high technology, product and systems provider,” Eric DeMarco, Kratos president and CEO, said in Kartos' announcement. “This divestiture will allow us even greater focus on our high growth core businesses including unmanned aerial drones, satellite communications, missile defense, training systems and microwave electronics."

For Securitas ES, Byerly said this acquisition is also “about growth, strengthening our core capabilities, expanding our portfolio of security solutions, entering new markets and exploring new technologies to best serve our customers. The addition of KPSS continues our mission to be best in class in our industry.”

He continued, “It's a great time to be part of Securitas as we build something special in the industry. We're looking forward to welcoming the KPSS associates and customers into the SES family. We are excited about the next chapter in our journey.”

Canaccord Genuity is serving as exclusive financial advisor to Kratos in connection with the transaction and Paul Hastings LLP is serving as legal counsel.