Going private after several years as a public company, and after re-branding several times. Are they lost and running away or running toward an unknown? When “private” again, the new company will have lots of new management at the top, mostly from outside the industry. We believe they do not have the luxury of a new start-up company, because of the rusty old anchor that could send them into bankruptcy, again. The anchor is their existing 500,000+ traditional deterrent type customers, aka future RMR revenue and earnings. High attrition put them into bankruptcy… expect more of the same. These are customers that were sold person-to-person, a system custom designed, the system custom installed, with the expectation of on-demand site-response by local police. Now, the new norm; slow or no priority alarm site-response to deterrent type private contract customers. The consequences, high attrition, and more, including the specter of rebates of multi-year subscription fees and the related reduction of future revenues/earnings. This is an industry wide problem, not just Monitronics. Including ADT, Vivint, RapidResponse, Lydia/COPS, NetWatch/NMC, and several hundred peers. We believe solutions are nearby…. but that means they have to first acknowledge the problem. Question for investors and IPVM audience…Is Brinks Home/Monitronics just-in-time or too late?
Source: Lee Jones; Support Services Group
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