Private equity firm buys Ackerman Security

In its first security industry investment, Toronto PE goes for super-regional
Wednesday, April 1, 2015

TORONTO—Imperial Capital Group of Toronto has acquired super-regional Ackerman Security.

Imperial Capital, which partnered with OPTrust on the deal, had been looking for a platform company in the security sector, said Ed Truant, an Imperial Capital partner.

"Ackerman represented an excellent investment opportunity due to its strong customer value proposition, a history of strong growth with many opportunities for growth in the future and a proven management team with exceptionally strong execution skills.  All in all, a very positive story about the evolution of a remarkable brand in the security industry," Truant told Security Systems News.

The transaction amount was not disclosed.

Atlanta-based Ackerman, a provider of security system installation, servicing and monitoring solutions, has an RMR of more than $3 million and gross revenues of $60 million, CEO and president Jim Callahan told SSN. It has more than 100,000 accounts, of which 80 percent are residential, and national accounts in 48 states in Puerto Rico, he said. One of the 25 largest security companies in the United States, Ackerman has more than 300 employees with offices in the Metro Atlanta area, North Georgia and Washington D.C.

Callahan will continue to lead the company. “Nothing will change from a management perspective,” Truant said.

Callahan visited the D.C. office the day the deal was announced to assure employees there that the transition would be seamless.

"It was a planned exit on the part of the [former] private equity group," Callahan said. "They were here for 10 years and they had a very good run. We were one of the best investments in their portfolio."

Imperial Capital was impressed with Ackerman's business plan, which includes taking advantage of home automation offerings to boost RMR, Callahan said.

As managing owner, Imperial Capital will make additional funds available to Ackerman “if they want to grow the business. We’ll fund strategic initiatives,” Truant said.

Those initiatives will include new locations through expansion into other markets, Callahan said. "It's not going to happen tomorrow, but we will be expanding," Callahan said.\

Imperial Capital specializes in niche industries. The Ackerman acquisition is its first investment in the security sector, Truant said, but possibly not its last.

“We will definitely continue to look at this sector. It has great characteristics, it’s recession-resistant and home automation [is fueling its growth],” he said. “We like the sector a lot.”

The Edmonds Group, which specializes in the security industry, was the exclusive financial adviser to Imperial Capital and OPTrust.

Raymond James and Barnes Associates advised Ackerman on the deal. "They are two of the best in the business and they ran a successful process for us," Callahan said.

Ackerman Security Systems was founded by Charles Ackerman and Bruce Turry in 1976. They sold the company in 1990 and in 1992 bought another small alarm company and again called it Ackerman Security Systems.

Turry retired as chairman of the board in March, as part of an existing succession plan.