Securitas set to acquire Diebold division for $350m
NORTH CANTON, Ohio—Securitas has agreed to buy Diebold’s North America-based electronic security division for $350 million. The divestiture by Diebold is aimed to better position it to pursue growth in the self-service industry, it said. For Securitas, the purchase "will bring added value to our customers" with added levels of protective services.
The deal, subject to regulatory approval, is expected to be completed in the first quarter of 2016.
Diebold Electronic Security has current annual revenue of about $330 million, it said in a prepared statement. It has about 1,100 employees, 55,000 monitored customer locations and 200,000 sites serviced. Diebold Inc. will retain all its physical and consumer transaction security businesses related to its core financial market, including automated teller machine security, anti-fraud card solutions, bank branch facility and drive-up systems, and related services, according to a the statement.
Under the deal, Securitas, based in Stockholm, Sweden, will serve as Diebold's preferred supplier for electronic security solutions in North America, the companies said.
Tony Byerly, who has led Diebold’s global electronic security business for more than three years, will continue to lead the electronic security business as president and report to Santiago Galaz, divisional president Securitas Security Services North America.
Galaz said in a comment to the acquisition, “We welcome Tony and his entire team to Securitas. Securitas Electronic Security—previously Diebold Electronic Security—will continue to be a leader in the North American electronic security industry. With this acquisition, we will have the ability to increase our security solutions sales, while also being an active player in the technology market, which will bring added value to our customers and make our offer much stronger. We also believe that we can leverage Diebold’s electronic security expertise to Securitas’ existing customer base and offer our customers possibilities of protective services by optimizing the equation between different service components."
Andy W. Mattes, Diebold president and chief executive officer, could not be reached for immediate comment by Security Systems News. He said in the prepared statement that “Securitas has the scale and resources to take electronic security to the next level for our customers” while allowing Diebold the chance “to accelerate our own transformation and focus on the exciting opportunities we’re seeing for growth and innovation in that [self-service] market.”
The deal "effectively leapfrogs Securitas over other rivals in the industry for systems integration," Jeff Kessler, managing director at Imperial Capital, told Security Systems News.
It seems Securitas is "trying to correct a mistake" it made in 2006 when it decided to focus on guards rather that electronic physical security, Kessler said.
"They didn't overpay, but it's certainly a higher end price," he said.
Diebold is not getting out of the security business, Kessler noted, it will have a preferred vendor position with Securitas.
"Security remains a core competency for us," Diebold spokesman Mike Jacobson told SSN. About 75 percent of the company's revenue is derived from the self-service industry, he said, and now Diebold will be able to take that to the next level.
Continuity was a main goal with the acquisition, Jacobson said.
"Diebold will continue to focus on ATM and bank branch security and anti-fraud," he said, and being able to service them.
Diebold's advisors for the transaction were Bank of America Merrill Lynch and Jones Day. Securitas was advised by K&L Gates.