Convergint Acquired By Ares Management

Author: John Honovich, Published on Feb 05, 2018

Convergint literally has been acquiring integrators left and right, with more than a dozen in the past 2 years.

Now, it is Convergint's turn to be acquired, by an "alternative asset manager" named Ares. Who is Ares? What does this mean for Convergint? How will this impact rival security integrators?

In this note, we share feedback from Convergint and examine these questions.

********** ********* *** **** ********* *********** **** *** *****, ******** **** * ***** ** *** **** * *****.

***, ** ************'* **** ** ** ********, ** ** "*********** ***** *******" ***** ****. *** ** Ares? **** **** **** **** *** **********? *** **** **** impact ***** ******** ***********?

** **** ****, ** ***** ******** **** ********** *** ******* these *********.

[***************]

From ******* *** ** ****** ****

********** ** ***** **** * ********** ***** ** * *** owner. ********** ********** *** ***** ***** ******* ********, ***** *** ****** ~$* ******* ***** ********** *** ~** employees. ***, ********** ** ***** ****** **********, * ******** ****** ******* **** $***+ ******* ** ********** and ~*,*** *********.

*** **** ********** ******** **********'* *** **** ****** **** *** the *** *****'* ******* ** ******** ******* ******. **** ** 2012, **** *** ******** **********,********** ******** ******* *** ~$*** *******. ***, **********'* ******** ******* ** ****** ****** ****, ****** both ** ******* ****** *** ********* ** *********** ** *** interim.

********** ********* ** **** **** ********* ***** ***** ****:

******* ****** **** *** **** ********* **** *** ********** ******* in * **** ********. *** ******** ******** *** ******** **** a **** ****** ******** *** * **** **** *** *** projected ** ******** ******* ** **** ****** ***** ******* *** the *********** ******. ********** *** ******* ****** ***** ****** *** almost *** ****** ******* *** ******** *********** ****** **** *** past *** *****. ** ****** **** ****** ***** ****** ** continue ******* * *********** ** ******* ****** *** ********* ************. Our ****** ******* ******* *** ******* ** ** ******* **** of *** **** ********** (*********) *** ******* ** *** ******** as **** ***** **** ** *** **** **** ***** *********** to **** ** ******** ** *****. ** * ******, *** strong ******* ******* ******, ** * ******* ********, ****** ** to ******* ****** ********* ********.

Valuation *** ****** ******* *********

***** ********** **** *** ******** ********* *** ******* ***********, ****'* estimate *** **********'* ******* ********* (**** ****) ** ~$* ******* and **** ***** ******* **** ** * ***** **** ** approaching ~$* *******. ** **** **** ** **********'* ****** ***** statements ***** ~$*** ******* *******. ***** ***** ******* *** ******** growth, ** ***** ****** * ********* ** ** ***** * - *.** *****. *** ***** **********'* ********* **** **** ****** double-digit ****** ** ********, ******** **** **% ****** ****** **** over * *****, ***** **** **********'* ******* ***** ** ***** double **** ***** ** ** *****.

******:********** **** **** **** ** $* ******* ** ******* ** 2018, ****** **** ** ******* ****** *** ******* ************. **** further ******** *** ******** ** **** ******** ~$* ******* ****** revenue ** *** **** * *****.

Ares ****** ********

*** *** **** ****** ***** **** *** ****** ****** ** fund **********'* ******* ********* ********** *********** ****. ** ********, ********** was ******** ***** ***** ******** ** ***** ********** ******* ***** KRG. *** **** ****** *** ** ******* *** **********, **** to **** **********'* ****** *** ********** ** ******** *** ***** expansion *** ********** ******.

More ********** ************ ******

**** **** ***** ****, ** ** ***** **** *** **** to ********** ********** ****** ******* $***+ ******* ** **** ** integrators ** *** **** *** *****. ***** *** **** **** *******, ** ***** ********** *** * ***** ***** *** *** first ****, ****-****** **** *********** ****** ***** ***** ********** *****. It ** ** **** ***.

*** **** *********** ******* ********** ** ******** ****** ******** *** security *********** **** ***, ** ***, ***** ********* ***** ** willing ** ***.

Convergint ********* *********

**** **** ********** *** **** ***** ******** ***** ***, ********** is ********* ***** *** ***** *** *** ***********. *** *******,****' ***************** ** ***** **** ** ** ** ***********:

*************'* ***** ***************** ****** *** **** ********** *** **** ********, *********** **** they **** '********' **** ****:

********** ********* ** **** ****:

***** ** ******* ********** ** ****, ** **** *** **** financial ********. ** ********* **** *** * ****** ********* ******* that ******** ** *** ********** *******, ********, *** ********** ****. This *** **** **** **** ***** ******* ** **** ***. Each ** *** ********* ******** **** ****** ** ** **** while ********** *** ******** ********** **** ** ******** *** *** Convergint ******* *** **********. **** **** ** **** * ******* that **** **** ** **** ********** ** *** **** ***** of *** ********* ******* ** *** *** *** ****** ** almost ****** **********’* ***** ** ****** ******* *** *********. ** see **** ** * **** ******* ** ****** **********’* ******.

***** ********** ** ********* '*********' **** ****, *** **** ** Ares **** *** ********** *** **** ********* **** **** **** certain ****** *** *******. ********** ******** ******* ******* ** *** their *** ************* **** *** ******** **** **** ******** ****.

Benefits ** ********* *********

*** ******* ** ********** ********* ***** ********* ** ** ***** potential ******* / ******** **** **********'* *******. ********** *** ****** hard ** ***** *** ****** * *** ***********, ** **** image ********* ******* **** ************:

** ********, $*** ******* ********** *****, **** ***** *** ***** Ares, *** ********* **** ******* ** ********** *** **** *******. The ********* *** ******** *** ********** **** ** ** ******* both.

Exit ******** - *** ** ******

********** ********* ** **** **** *** **** *** **** ** likely **** ***** ** *** ******:

**** *** ***, ** **** ******* ** ******** * ****-**** sustainable ******** **** ** **** *** *** *********, *** ********** and *** ***********. ** ***** ****** ** ***** * ******* for *** ******* ** ******** ** ** **** * ***** dollar. **** *** **** **** *** **** **** *** ******* in **** **** ** *** **** ********** *** ** ** true ***** **** ** **** **** **** ********** ****** *** globe. ** ****** ** *** ******* ****** **** *** **** of ****. ** ** **** **** ** **** ***** **** will **** ** ******* * ****** *** ***** *********, *** we ******** ** **** ** ***** **** ****-**** *********** *******. We ******* ** ***** ****, ******* ** ** * *****, 7 *****, ** ******** ** *****, *** **** ********* ********** will **** **** ** ******.

***** **** ***** ******, ** ***** ****** ***** **** ** be ***** *** ** *** ******.

Outlook - ********** ********** ***** ** *** ****

*** ***** ** *** ****, ****, ***** ***** ********** ********, would *** **** **** **** **** ** **** **** *** committed ** ************* ******* **********. ** ****, ** ***** ****** Convergint's ***** *********** ******** ** ******** **** **** *** ****. And ** ** ********* ** ************* ************ ********* ********** **********, ***** ** ** ***** **** **** ** ******** **** significantly ******* *** *********** ********* ** ******** ***********.

*** **** ******** ** *** ********** *** ******** **** **. Will **********'* ********* *** ********** ************ ****** * ****** ********** that ********* *** *********** ****** ** **** ** ******** ***** its *** ******?

Comments (12)

*** *** *** *** **** ***** ********** ****** *** *** clue ** ** ** **** *** ************ ** **** '**** that ******* **** *** ******* *** *** ***** ******* *** thing ****** ** ******? ****'* *** **** *** **** *** stockholders *** ***** * ********** *** *** **** **** **** the ********* ******* ******** ******** ********* **** ****' ****? (*** all *** ********** ************ *** ***, ***** *** **** ****** in *****. *** ***** *** **** **** *******...)

***, ******** ** ****....

***** ** **** *** ****** *** **** *** **** ****** days, *** ********** **** *** **** ****** *** ** *** perfect ****.

****, * ** *** **** *** ***** ** *** **** of * **********. **'* ******** **** ****, ******* **** *,*** reads.

* ******* *****'* **** ******* ***** *** ** **** ******** people ******** **** ** ******* ******* **********. ****, ** ******, is ****** ** ****** ** *** ****** *********...

**** ** * **** *********** *******.

* **** *** **** ************* **** *** ***** **** ******/**********'* of *** ***** **** ****** ** **** ** **** ******** may **** ****.

** **** ** ********** *** ******** ** ***** *****, ** it ******* *********** ** ******* ******* ******. **** ** * tale **** **** **********'* ****** **** **** * *****.

*** ******* ** ***** ** ** ********* **** **** ******** owners **** ** ** **** ** ** ** **** *****.

**** ***** **** *** ******** ***** ** ***** *** **** and **** ** ****** ** *** ********

********* **** ******** ** ***** ***** *** *** *** *********** strategy ** ***** ** ********* *******

* **** **** ****

*****, ****** *** *** ********!

** **** ** ********** *** ******** ** ***** *****, ** it ******* *********** ** ******* ******* ******.

****'* **** * ** ****** ** ********** - *** *** they ******** *****? ** ***** *****, *** ** ********** **** valuable ***** ****** * ******* *** **** ** ***** ********** integrators? *** ***** '*********'? ** *** ***** '********* ** *****'? Is ***** **** **** ** '******* ******'?

**** ** * **** **** **** **********'* ****** **** **** a *****.

***, ** **** *** *** ********** ** *** **** ***! :)

**** ** *** *** ***** **** ********** ****-**. *** **** did ****, ** * ******* *****, * ****** ***. *'** heard ***** ***** ** ******* ***** *********** ********** **** ***** financier ****** ****-***. * ** *** ******** ***** ** ***** to ** ****. * ** ******** ****** *** *************, **** a ****-****, *** * ***** ********** ***********.

** *** ***** ****, ********** **** *** ***** *** ******* transportation, ********* *** ***** ****** ******** *** ** ******' ******* in ******* **** * **** ****** ****** ********* ** ********** integrators. ** *** **** ****, ** *** ************ **** ***** the ********** *********** ****** ** **** ********, *** ******* *** responsiveness ** **********'* ********** ******* *** ******. ******* ** ******* where **** ******** ******* ******* *********** *** ****** *** ** general *********** **** **** ****** ********* *****.

** ******** ** **** ******* ****

*** ****** ** **** ***** ******** *** **** ******** ** other ******** ********* *****

*** ***** **** **** *** ******** ** *** ****** ******** of ***** *********

******* ****** *********/********** ******** **** **** ******* **** **** ******** on * ****** **** ******** *** ************* *****

*** **** ** ********* *** ********* ** ***** **** ** determined ** ***** **********'* ********* ** ****** ***** **** *** together *** ** ********* *** ***** ** **** ********* ** that

*** **** ** * *** ** *** ****** ******* *** acquisitions ** *** ************ ****

***** *** * *** **** **** **** **** ** ****** merge *** ********** ******** ** ****** **** ***** *** **** there *** ***** **** ******** *** **** *** ******** ******** under *** ********* ********

*** **** ******* **** **** *** **** *** **** ** they **** ** **** **** ** ********** ****

** *** ** *** **********'* ****** ** ********** ** **** news

*** *** ** **** ***** ********** ****** ****

** ****** ** *** ***** ***** *** ********, **** **********'* would *** ******

* ***** *** **** ***** *** **** **** **** ******* builds * ********

**** **** ****** *** ******* **** ********** ****** ** ***** field *** **** **** **** ** *** "***** *** ** go" ** ** *********** ** *** **** **** ** ******* is *** ***** * ** ****** ** ****. ****** **** is ** *** ***** **** ** ***** ***

*** **** ******** **** ******, ** * **** ** *** from ***

**** **** ***** *** **** (********* ***) *** ** *** premiums **** ** ***** ************

** **** **** ****** ****** ***** ******** **** *** ***** out *** ***** *** ***** ** **

* **** ** **** ********* ****, **** ********** ** ******* for **** *** *****

* ***** ******* **** ******** ****, **** ** *** **** work !!

*** ***-*** ** *** ***** ******* *** *** **** ** any ********* ********** ** ****, **** ****** “*****” *********** *** included.

****, **** *******.

*** **** ***** **** **** ***** ******** *** ***** ***** new “*******”?

**********'* ***** *********** *** ******* * ********* **** ****. **** ** *******.

*******,**** *********** ***** *********** ******* * ******** ***** ***** **********:

“********** ** * ****** ** *** ********, **** * ****** culture *** * ************ ***** ****** ** ********* *** *********** of *** ********** *** ********** *********** ******* ** *** *********. We ***excited ** ******* **** *** ********** ********** **** and look forward to supporting the company in its next phase of growth,” said Matt Cwiertnia, Partner and Co-Head of North American Private Equity at Ares Management. [emphasis added]

***** ******* ***** ****, * ***** **** ***’* ********** ** their *** ******** ************* ****, **** *** ********* ******* ** Convergint.

** **** ***, **** *** **** **** ******* ** ******* the *********** ********.

******* *** *********** ********

***'** *** ***** ** ** ******* ** **********'* **** ********** screening...

* ***** ******* ** ** '********' ** ****** ******. * take ** **** ** * ******** ***** ** **, *.*., not ******** *********** *** *** *****, *** ** ** ***** ** ***** **** **** ** standing ****** **********'* ********, ***** * ***** ** *** ****, certainly *** *** *** ** **** ** ********** ******** ** the ****** ** ****.

******:********** **** **** **** ** $* ******* ** ******* ** 2018, ****** **** ** ******* ****** *** ******* ************. **** further ******** *** ******** ** **** ******** ~$* ******* ****** revenue ** *** **** * *****.

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