Covert ends three-year absence

GTCR taps him as the CEO to run the Honeywell security business
Wednesday, September 1, 2004

CHICAGO - Well-known security veteran Jim Covert is making a return after a three-year absence and the end of a non-compete agreement with Tyco.
Jim Covert

Covert has been tapped by GTCR Golder Rauner to become chief executive officer of its newly acquired Honeywell Security Monitoring business and play an instrumental role in the growth of the company.

David Trujillo, vice president of GTCR Golder Rauner, said the goal is to double the company’s recurring mon-thly revenue within the next three years, from $8 million today to $16 million.

“We had a great deal of success with Jim back in the Cambridge Protection days,” said Trujillo.

Covert and GTCR have a history of working together. The two teamed up in 2001 on the SecurityLink from Ameritech deal, a company that reported $500 million in annual revenue and operated 119 branches. GTCR provided the financial backing and Covert brought the executive management expertise.

Within a matter of months, GTCR and Covert turned the business around, reducing overhead costs and consolidating locations. They then sold that installation business, renamed Cambridge Protection Industries, and National Alarm Computer Center, a California central station, to Tyco for $1 billion.

Trujillo said GTCR plans to reshape the Honeywell Security Monitoring business, but the approach will be different than that of SecurityLink. He said intends to grow the business and hire additional sales people, not reduce operations.

“This is less of a turnaround than SecurityLink,” said Trujillo. “This business is highly profitable, but it’s been diminishing in size over time.”

The Honeywell Security Monitoring currently serves 120,000 customers from 45 locations. Of that, 85 percent of its business is in the commercial side of the market.

According to estimates from Tim Whall, who was hired by GTCR to serve

as president and chief operating officer of the monitoring business, Honeywell Security Monitoring had approximately 1,200 employees three years ago compared to its headcount of 800 today.

Whall expects to grow the company’s employee base, especially when it comes to the company’s sales force. Within the first 12 to 24 months under new ownership, Whall said its sales division could grow from 100 people to 300 people.

“We need to start growing the business and be a little more active in the marketplace,” he said.

Though only a few months into owning Honeywell Security Monitoring, GTCR is already thinking about a new name for the business. It has the right to use the Honeywell name for one year, but can say the business was formerly known as Honeywell Security Monitoring for two years.

Covert could not be reached for comment prior to press time.