Allied Universal makes buy in Philly

Acquisition of Covenant Security Services broadens expertise in energy sector
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Wednesday, February 7, 2018

SANTA ANA, Calif. and CONSHOHOCKEN, Pa.—Allied Universal, a leading facility services company and one of the largest security forces in North America with more than 150,000 employees, on Feb. 5 announced the acquisition of Covenant Security Services Ltd., a Philadelphia-based security firm that is a division of Covenant Services Worldwide. Terms of the deal were not disclosed.

Allied Universal CEO Steve Jones told Security Systems News that Covenant is a great fit, as the company is well-established and respected within many verticals, most notably in the energy sector where he sees tremendous growth long-range and possibly globally.

“What really excited us about the deal it they are a very strong player—and have a high level of expertise working—in the energy and petro-chemical sector, which we felt was a tremendous opportunity,” said Jones. “This also gives us some additional expertise so if there are international expansion opportunities beyond the markets we are in today, which are the U.S. and Canada, the energy and petro-chemical sector is one of those sectors that would lead us to that growth.”

The deal only includes the commercial security services division of the company, and does not include its aviation division, which will remain under Covenant Services Worldwide. All told, close to 2,000 employees will be joining the Allied Universal team, including all of the security officers from the commercial security side and several from the management and leadership team, Jones noted.

In addition to the chemical and petro-chemical segments, in which Covenant has been a leading regional provider of guarding services since 1992, the company adds vertical segments such as commercial real estate, defense and aerospace, and manufacturing and utilities to Allied Universal’s clientele base. Covenant represents $80 million in annual revenue, with a cross section of major national clients and government accounts.

“Pairing Covenant with Allied Universal is a natural move for both organizations,” Gregory Iannuzzi, president of Covenant Security Services, said in the announcement. “Combining Covenant’s client-driven approach and award-winning safety culture with AU’s scale and technological sophistication is a win-win for everyone. This partnership presents an opportunity for Covenant’s clients to continue to receive high levels of customer service while at the same time gain access to a vast network, notable innovations, technology, and reputable management team.”

Jones said the deal represents a great start for Allied Universal in 2018, after experiencing strong growth in 2017. “We had a great growth year … we grew 12 percent, both organically and through acquisition, so it was an exciting year and we are excited about 2018,” he said.

From a systems and technology standpoint, Jones said Allied Universal is “continually rolling out our new technology offerings throughout our customer base, while we continue to look for strategic acquisitions and focus on being a more comprehensive security solutions provider—not just pure labor.”

He continued, “For example, we have dozens of robots implemented around the country now and our remote video monitoring business continues to grow. Our new safety and security monitoring side of our business that we offer in our monitoring center, in regard to threats against our clients, is also growing tremendously. We see these as really an opportunity to try and find ways to bring additional services while using technology to do it in a more cost effective way.”