ADT buys Smith Alarm

Tuesday, January 1, 2002

BOCA RATON, Fla.-A company that was once promised to SBC Communications' division of Ameritech has now been purchased by ADT, as the security giant continues its multi-year acquisition spree.
Smith Alarm, based in Dallas, was a strong player in the Texas market, with at least 10 branches throughout the state and one in Oklahoma City. The company was purchased by ADT in late October.
Smith is the latest provider to be sold to ADT, and follows the purchase of South Carolina-based Scana Security in April, Cambridge Protection Industries, including SecurityLink, in late May and Edison Security in California in June. The company also bought the 80,000 account, 20-location division of Honeywell Security Canada in June of 2000.
In August, ADT also quietly picked up West Palm Beach, Fla.-based systems integrator Digital Detection Systems. That company had five locations in Florida, including its corporate headquarters, as well as three locations in Arizona and one in Georgia, according to its website.
With the addition of Smith Alarm, the largest independent dealer in Texas, ADT adds about 70,000 more accounts monitored out of Smith's Dallas central station. The central station was still in operation at press time, according to Dave Weimer, a former Smith Alarm executive who is now ADT's general manager for the Dallas location.
Then-Chief Executive Officer Charles May, who purchased Smith Alarm in 1994 with Citicorp Venture Capital, signed a purchase agreement with Ameritech in 1998 that Smith Alarm would be sold to Ameritech after the moratorium imposed by the Telecommunications Act expired in February of 2001. The Telecom Act prevented regional Bell companies from buying alarm companies.
SBC never exercised its option on Smith Alarm and instead sold its SecurityLink division in January of 2001 to Cambridge Protection Industries, whose president James Covert founded SecurityLink a decade ago.
Weimer said that most of Smith's 500 employees were "able to stay on with ADT in various capacities" and that a number of Smith's branches are still in existence. Branches in Houston and El Paso were large branches, servicing the bulk of the company's commercial accounts, while the other branches were smaller sales and service locations. About 65 to 70 percent of Smith's accounts were residential. The company was averaging about 2,600 installations a month.
"If (ADT) had a branch in that city or our site worked better, then they consolidated into our site, but pretty much everything stayed," he said. ADT officials did not return calls by press time.