Tri-S sells off resi. accounts
ATLANTA--Tri-S Security, a provider of guards and system integration, as of late July has exited the residential market entirely, selling all of its residential accounts, along with a central station, to Security Alarm Financing Enterprises, a San Ramon, Calif., company providing alarm service and financing for alarm companies. SAFE paid $680,000 for International Monitoring, based in south Florida, one of the companies Tri-S acquired with the Cornwall Group in late 2005, and has agreed to purchase more accounts from Tri-S over the next 90 days.
Tri-S chief executive officer Ronald Farrell said that there were a number of additional accounts that need to be "cleaned up."
"Maybe there's paperwork that needs to be done," he said. "It could be that the customer hasn't technically renewed the contract, but they're still paying us." As the accounts get cleaned up, SAFE will buy them through the agreed upon date.
This, coupled with earlier sales of Army Fleet Support for $10.8 million and a piece of real estate for $774,000, has brought in $12,270,000 in cash for Tri-S over the past few months, nearly eliminating its bank debt, said Farrell: "We have de-leveraged our balance sheet substantially."
As Tri-S looks to grow the commercial installation side of the business, it is now in a much better position for acquisition, Farrell said.
"That's what was good about it," he said, "because it was easy to spin-off, there was no overlap between the commercial and the residential sides of the business. Now we'll try to build and emphasize that [commercial] business. It was a good transaction. It made good sense for us to get out of the residential business. It was so small that it didn't provide any earnings. Converting it to cash was just a good idea."