MAC buys Integrated Systems as platform for growth
DENVER—Mountain Acquisition Company acquired systems integrator Integrated Systems, based here, and plans to use the operation as a platform for growth.
MAC already owns Apex Security, which does a mix of ultra high-end residential work and commercial work in the resort area of Aspen. In addition, MAC has two other acquisitions in the works, in Colorado and California, that represent an additional $165,000 in RMR.
The plan is to move administrative and back-office operations to the office in Denver “to function as a hub,” Chris Heath, manager MAC and CEO of Integrated Systems, told Security Systems News. Apex Security will be a “spoke” he said, “more of a sales, service and customers service office.”
When the other acquisitions are completed, they will become “spokes” of the Denver operation as well.
Frank Lawrence, former owner of Integrated Systems, is staying with the company in the role of technical director. Founded in 1977, Integrated Systems has 26 employees, about $3.5 million in topline revenue and $110,000 in RMR. It has 2,500 residential, commercial and institutional customers including the largest school district in Denver.
Integrated Systems does intrusion, video, environmental supervision and fire alarm, and has particular expertise in engineering and design. Its customers run the gamut from “$1,000 residential installations to hundreds of thousands [of dollars] for a single installation,” Heath said.
MAC bought Apex Security, based in Glenwood Springs, Colo., a suburb of Aspen, in 2006. At that time it was losing $80,000 per month, Heath said. MAC took over full operation of the business in 2008, and since that time it has had $3.7 million in top line revenue, and between $800,000 and $1 million in operating profit annually.
In addition to “ultra high-end residential” work, it does “commercial work top-to-bottom,” from small mom and pop stores to retail, liquor stores, all the way up to local government and fairly large businesses. It employs 25 people including a small unarmed guard force. Aspen is a verified response market, he noted.
“We plan to leave Apex and Integrated Systems as local market leaders branded the way they are to take advantage of the brand equity there.” However, Heath said, the name MAC will be going away. The parent company will be rebranding with a new name that better reflect its focus on security, he said.
The other two acquisitions that MAC has in the works are also “local market leaders in resort areas.”
Target acquisitions for MAC are “local market leaders with good technical ability, good front end capability that could benefit from us being a financial type operation,” Heath said.
To build its hub, MAC “went in search of a company in Denver because the operating expenses in the resort areas is so great.” Being in Denver “will allow us to expand the business and give us a base of operations in a place that has a wider, cheaper and deeper labor pool.”
MAC has hired two industry veterans to help build the business: Tim Stanley, who has worked for Kratos and ADT, is heading up sales and marketing, and Chris Keith, who has worked in security for 20 years, is operations manager.
Heath and Fred Maurice are equal partners in MAC. “He is the numbers guy and I’m the deal guy,” Heath explained.
The goal for MAC is to have “about a million in RMR and to operate the company at that level and get out of acquisition mode.” How long will that take? It’s a goal, Heath emphasized. “It depends on a lot of variables. It could take two years or it could take five or we might never get there.”