GE Interlogix adds depth with MAS

Tuesday, July 1, 2003

IRVINE, Calif. - GE Interlogix announced in June it had completed the acquisition of well-known Monitoring Automation Systems, known to many simply as MAS, in a deal that’s being called a surprise by some.

“It’s absolutely raising eyebrows,” said John Mack, president of USBX Advisory Services, a consulting and mergers and acquisition firm.

Until now, GE’s acquisitions in the security market have focused on the hardware side. This deal, said Mack, marks its first software company purchase, not to mention an alarm monitoring software company.

“I don’t think people are used to seeing one of the big manufacturers buy players on the software side,” said Mack.

The purchase price for MAS, a privately held company that had been in the market for more than 20 years, was not released. The company is known to provide monitoring automation software to some of the biggest players such as ADT Security, Protection One and Brink’s Home Security.

Steven Keefer, the former majority shareholder of MAS, its founder and now its president, said the company will continue to conduct business as it has in the past and is not expected to change under GE Interlogix’s ownership.

“We serve our customer with every product that they use. I don’t see that changing,” said Keefer. “If our customer uses a GE product, that’s fine. If a customer uses a non-GE product, we’ll support that, as well.”

Like many of the other GE Interlogix acquisitions before it, MAS expects to benefit from GE Interlogix’s research, development and technology. Along with Keefer, plans call for MAS’s 80 employees to remain onboard.

GE Interlogix expects to benefit from synergies provided by MAS, said Chuck Durant, president of the Security & Life Safety Group of GE Interlogix, since an estimated one-third of all security installers in the market operate their own central station.

The two companies had been familiar with each other for a number of years. They have collaborated on several projects, including a recent partnership in which MAS is providing the software that enables a video verification system to transmit an alarm signal to the control panel and then to a central station.

Collaborating can perhaps be looked at as one of MAS’s strong points. To make sure its monitoring automation software works with all the different central station receivers and other equipment on the market, it has had to work with manufacturers to develop interfaces.

“That’s what we’ve prided ourselves on,” said Keefer. “We have developed over the years interfaces on so much equipment it’s hard to believe.”

Keefer’s entrance in the market could be called happenstance. In the early 1980s, Keefer was running a company that provided software to various markets, but when a security company approached him to develop monitoring software he saw a niche market.

“We realized it was a little different than what we had done in the past since secuirty is 24/7,” he said.

Monitoring Automation Systems was then born to focus exclusively on this market from a software company standpoint, a new concept because previously a central station developed a proprietary system or it bought a system off the shelf from a hardware manufacturer.

Security industry analyst Mack said over the years MAS had been courted by many companies, but rebuffed those offers. Part of the reason for the sale, he speculated, is that “every company in its evolution wants to be able to create a return for its stockholder.”