Security

Trading Conditions Marginally Improve and Consolidation Activity Continues to Grow in the First Quarter of 2010

In the first quarter of 2010 the number of acquisitions announced has grown by 50% on the same period of 2009 and has more than doubled based on the cost of buying. This trend looks set to continue for the rest of this year. Deals announced in March have significantly increased on February but have not reached the January bumper start to 2010 that had 9 deals including the Broadview Security acquisition which added $2 Billion to the acquisition kitty. We recorded 7 deals in March compared with 3 transactions in the same month of 2009. On both the metrics of volume and value acquisition activity is well up on the same period of 2009, confirming the continuing trend for growth in the consolidation process during the last 7 months. Schneider Electric has returned to the dealing table with the purchase of Zicom Electronic Security Systems one of India’s leading security companies. This looks a […]

Stay ahead of the pack

with the latest independent smart building research and thought leadership.

Have an account? Login

Subscribe Now for just $200 per year per user (just $17 USD per month) for Access to Quality Independent Smart Building Research & Analysis!

What Exactly Do you Get?

  • Access to Website Articles and Notes. Unlimited Access to the Library of over 1,700 Articles Spanning 10 Years.
  • 10% discount on ALL Memoori Research reports for Subscribers! So if you only buy ONE report you will get your subscription fee back!
  • Industry-leading Analysis Every Week, Direct to your Inbox.
  • AND Cancel at any time
Subscribe Now
In the first quarter of 2010 the number of acquisitions announced has grown by 50% on the same period of 2009 and has more than doubled based on the cost of buying. This trend looks set to continue for the rest of this year.

Deals announced in March have significantly increased on February but have not reached the January bumper start to 2010 that had 9 deals including the Broadview Security acquisition which added $2 Billion to the acquisition kitty. We recorded 7 deals in March compared with 3 transactions in the same month of 2009. On both the metrics of volume and value acquisition activity is well up on the same period of 2009, confirming the continuing trend for growth in the consolidation process during the last 7 months.

Schneider Electric has returned to the dealing table with the purchase of Zicom Electronic Security Systems one of India’s leading security companies. This looks a shrewd buy for its growth in 2009 was 41%. The Risco Group acquired a controlling interest in Electronic Line 300 Ltd a company listed on the Frankfurt stock exchange. Acquisition of German companies is somewhat of a rarity unless acquired by other domestic companies.

This month L1 Identity Solutions announced that this could be the right time for its shareholders to realise the capital value of the business and it therefore looks as though a “For Sale” sign has been firmly placed in the ground. Formed in 2006 this is a remarkably successful and fast growing company and therefore there is likely to be a number of seriously interested buyers with the French based Safran (Sagem Securitie) leading the pack. We can expect the Venture Capital companies to take a similar view about some of their investments in the security business and this will add further momentum to the increasing pace of consolidation over the next 6 months and beyond.

Yet again this month 3 IP Video companies raised finance following on from 3 last month. This month Pivot, Aimetis and Avaak Inc raised some $40m between them, whilst Exacq received a tax incentive for investing in additional manufacturing facilities. RFID firm TAGSYS topped all of this by raising $97 million. So the Venture Capitalists are back picking and choosing no doubt, looking for companies that can prove they are growing and profitably or thereabouts. Or are they returning because of their over exposure to the Clean Tech business?

Provided the World Economy can continue to stabalise and achieve growth of 1 to 2%, this year should be the ultimate buyers’ market for investors with cash to spend. Many businesses have been forced to tighten their belts for the last two years and are now running out of cash. As now evidenced, many are looking for funding to grow and continue operations. However many will be looking to sell if the right opportunity becomes available and as we have clearly shown in our survey;


http://memoori.com/blog/survey-of-the-security-business-2009-shape-structure-a-consolidation

2010 will be a buyer’s market, for fragmentation is driving those hundreds of companies, operating well below the minimum economic size, to sell up or exit the business. These are exciting times because the investment in this business at this time owes nothing to a rapidly growing market. It is based on the fact that the physical security business has proven its resilience and when growth returns to the economy this market will outstrip the halcyon days of double digit growth in the middle of the last decade, because it will be healthier and stronger.

Most Popular Articles

Zaha Hadid Twinmotion Game Engines
Smart Buildings

The Game-Changing Potential of Game Engines for Building Design

What would it mean for the real estate industry if we could visit our facilities before they’re built? If we could walk around a virtual building to better understand the space and test how various systems work in real-time, before making adjustments. If we could take owners and investors on a tour of their future […]

Smart Buildings

Azbil Building Automation Business & FY2023 Financials Examined

In this Research Note, we examine Azbil, a Japanese public company with a leading position in the domestic building automation market. The financial highlights and growth strategy analysis of the Building Automation business is based on their FY2023 annual results, year ending 31st March 2024, Annual Report 2023, and investor presentations. Azbil Building Automation Financial […]

Subscribe to the Newsletter & get all our Articles & Research Delivered Straight to your Inbox.

Please enter a valid email

Please enter your name

Please enter company name

By signing up you agree to our privacy policy