Devcon trumps Innova in Adelphia security buy
DEERFIELD BEACH, Fla. - Devcon International made a significant move toward building its security services division, Devcon Security Services Corp., as its high bid for Adelphia CommunicationÃ¢â‚¬â„¢s security businesses was approved by the U.S. Bankruptcy Court at the end of January.
Devcon bid $42.8 million for the cable companyÃ¢â‚¬â„¢s security division - Starpoint Ltd. Partnership, which operates as Checkpoint Ltd. in Florida and Adelphia Security in New York. That bid trumped the previous high offer of $38.2 million by Innova Security Solutions, a division of Boston-based private equity firm Alta Communications.
Even though Innova was the high bidder for the business late last year, Adelphia, which has been operating under Chapter 11 protection since 2002 and is currently auctioning off its separate businesses, was required by the U.S. Bankruptcy Court to place the business up for auction to ensure the highest value.
Stephen Ruzika, president of Devcon Security, said the deal provided the company with an opportunity to increase its presence in the market and especially bumps up its penetration in its home market of South Florida, where Checkpoint Ltd.Ã¢â‚¬â„¢s office is located.
Ã¢â‚¬Å“WeÃ¢â‚¬â„¢ve watched Adelphia for some time with Devcon getting into the business in August 2004,Ã¢â‚¬Â Ruzika said. Ã¢â‚¬Å“We have been looking for a platform acquisition in the Southeast. This property fits that well.Ã¢â‚¬Â
Now, Devcon adds the cable conglomerateÃ¢â‚¬â„¢s approximately 57,000 residential and commercial security subscribers to its account base. According to a press release, the company would account for 62,000 customers once the acquisition, which is expected to close at the end of February, is complete.
Devcon International, a publicly traded construction firm and distributor of ready-mix concrete, burst into the security arena in fall of 2004 when it secured $18 million in financing and purchased Security Equipment Co. for $4.5 million, which brought Ruzika - former president of ADT Security - to the company. The acquisition of the Adelphia security unit is the largest security deal Devcon has made to date.
Erica Stull, a spokesperson for Adelphia, was unable to comment on how the deal will affect the businesses, but Ruzika said one thing that will eventually change are the Checkpoint and Adelphia names.
Ã¢â‚¬Å“We have the right to use the use the name for some time,Ã¢â‚¬Â he said, Ã¢â‚¬Å“but we will look to change it.Ã¢â‚¬Â