Voxcom to sell to UE Waterheater, which will sell to Alinda
EDMONTON, Alberta, Canada--Voxcom Income Fund, owner of security alarm installer and monitoring firm Voxcom Inc., agreed April 17 to support a bid by UE Waterheater Income Fund to purchase all of its issued and outstanding units (shares) for a cash price of $13.25 (all dollar amounts in this story are Canadian; a U.S. dollar bought CAN 1.13 on April 17), representing a total equity value of roughly $108.5 million. Add in roughly $57 million in debt that UE would assume, and the total purchase price would be roughly $165 million.
UE's offer will expire 35 days after a formal take-over bid circular goes out no later than May 4, though Voxcom's biggest investor, Clairvest Group, which owns 20 percent of the company, has already agreed to sell its units and it seems likely UE will be able to acquire 66.6 percent of the outstanding units.
On the same day, UE Waterheater, which makes much of its money through the lease and service of more than a million Canadian water heaters, agreed to sell itself to New York-based equity investor Alinda Capital Partners for $1.74 billion. Voxcom is part of the negotiated deal.
Voxcom reported at the end of 2006 total revenue of $39.3 million on 120,300 accounts, an increase of 12,100 accounts from the end of 2005. With $38.39 million in 2006 monitoring and service revenue, Voxcom averaged roughly $3.17 million in RMR for 2006 and the purchase price of $165 million represents roughly a 52 multiple of RMR.
When combined with UE Waterheater's existing monitoring business, operating as Protectron and based in Montreal, the new monitoring operation will watch over 300,000 accounts and produce $100 million in annual revenue.
For more on this story, see the June issue of Security Systems News. An earlier version of this story mis-stated the purchase price, as it was not earlier known that Voxcom's debt would be part of the purchase price.