IASG acquires Alliant out of bankruptcy
ALBANY, N.Y. - In a move to bolster its position in California, Integrated Alarm Services Group acquired out of bankruptcy essentially all of the assets of Glendale-based Alliant Protection Services in an all-cash deal valued at $14.5 million.
IASG attains roughly 17,400 monitored alarm contracts that bill at nearly $30 per month, generating approximately $523,000 in recurring monthly revenue. The entire portfolio consists of accounts in northern and southern California, of which 60 percent is residential.
Ã¢â‚¬Å“I think it is a very important deal for us,Ã¢â‚¬Â said Joseph L. Reinhart, director of investor relations at IASG, in reference to the increased presence the company will now have on the West Coast. Specifically, he said, it Ã¢â‚¬Å“broadens our activities in the residential market.Ã¢â‚¬Â
Even though Alliant was founded more than two years ago with a charter to establish a national presence, the company never established a corporate identity beyond California. It was here that the company filed for Chapter 11 Bankruptcy protection in January, and where IASG snapped up the companyÃ¢â‚¬â„¢s business.
The deal also includes a small central station in California, and approximately 50 Alliant employees primarily in commercial sales and installation. With a headcount of nearly 550, IASG operates three emergency call centers, located in California, Minnesota and New Jersey. The company monitors more than 500,000 customers and also offers installation services.
Former Protection One executives Thomas K. Rankin and Sherman Brawner founded Alliant in July 2002. Soon after, Warburg committed more than $26 million to the venture. As is the case in most private equity deals, an investment firm will commit a large amount of cash to receive the privilege of a controlling interest in the company and the right to be the sole institutional investor.
Given the amount of money dedicated to the venture, a private equity firm will not release the bulk of the funds at once. Typically, the investment is stretched out over a period of years, and the financing is distributed once certain milestones, such as revenue targets, are met.
A Warburg Pincus spokesperson declined to comment on the deal and the total amount invested in the company.
Representatives from Alliant could not be reached for comment. Rankin had served as chairman and chief executive officer at Alliant, before resigning earlier this year. Gary Kulesza, a turnaround specialist from Cloyses Partners, replaced the former CEO. Brawner served as vice president of engineering.