HID Buys Mercury Security

By: Brian Rhodes, Published on Sep 19, 2017

One of the biggest access control deals in years.

Mercury Security, the most widely used access hardware OEM, and partner to 20+ manufacturers, has been purchased by Assa Abloy / HID Global.

In this note, we examine:

  • The Deal Rationale
  • Price and Valuation Estimates
  • Why Mercury's Vendor Neutrality Key
  • Profile of seller - ACRE
  • Detailed response from ACRE CEO
  • Analysis of value to HID
  • Why Partners are relatively relieved about this outcome
  • Risks to Mercury about HID's control

*** ** *** ******* access ******* ***** ** years.

******* ********, *** **** ****** used ****** ******** ***, *** ******* ** **+ *************,*** **** ********* ** Assa ***** / *** Global.

** **** ****, ** examine:

  • *** **** *********
  • ***** *** ********* *********
  • *** *******'* ****** ********** Key
  • ******* ** ****** - ACRE
  • ******** ******** **** **** CEO
  • ******** ** ***** ** HID
  • *** ******** *** ********** ******** about **** *******
  • ***** ** ******* ***** HID's *******

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

Deal *********

***'* **** ** ****** Mercury ** ********** *** footprint ** ***** ******** 3rd ***** *********** ********. While ******* * *** access ****** ** **** on *** *********** *** ******* business ****, ****** ******* makes *** *** **, if *** *** ****, influential *** ******* ******* in *** ****** ********** hardware ****** ** ****.

Price / *********

**** ********* **** ****** paid $*** - $*** million *** *** ******* Security [****** - **** is *****, *** ***]. This ** ***** ** the *********:

  • **** ********* $** ******* USD 2017 ******* *** ******* ******** and **** ******* *** "good **** ******" *** that "*** *********** **** be ********* ** ***"
  • ****'* **** ****** ** ~16% *** ***** ****** ********* is ~*.** ***** *******.
  • ***** ****'* ********** ** Mercury's ******** **********, ** would ****** * ******** price ** ** ***** 2.3x *******'* ******* ** to * ******* ** ~4x *******, ***** ******** a $*** - $*** million ******** ***** ********.

[******: **** ****** **** ~$400 ******* *** *******, according ** ******* ***** to *** *******, ****** the ****** ******** ** Mercury (*.*., ***** *** only *********** ****** ******* panel ******** *** *** depth ** ******** / installers) *** *** ********* value ** ***.]

*******'* *******, ******** ** the ******** ******** (*** ****'* ******* *********), ** *** **** high. *******, ******** ** Mercury's ******* ***** ****** the ****** ********, ** fairly ***********. ********, ** also ******* *******'* ************* to ** ***** ******, both ***** ** ****'* comments *** *******'* ****** position ** *** *****.

Mercury's ****** ********** ***

******* ********'* ******** ** OEMing ****** ******** ********** to ******** ****** ******* vendors, *** ********* ***** on ******** *********** / management *******.

* *** ******* **** is that ********* ****** ******* often ****** *** **** Mercury ******** ******* ***** their *** ******. ******* Mercury **** *** ****** to *** ******, **** end-users *** ******* **** someone ***** **** ***** access ****** ** *********** for *** ****** *** manufacture ** ***** *****. Indeed, **** **** ** mainstream ****** ******* ******* (including *****, **, ********* ProWatch, ***, ****, *** Open *******) ********* **** the **** ******* ******** firmware,***** *** ******* ***** as ** '****' ************ used ** **** **** 3 ******* ****** ***********.

***** *** ****** ***** application *** ***** ***** of ********* ****** ***********, Mercury ***** *** *********** products ******** ** ******* manufactured ******* **** ****** companies ********* ***** ***** alone. ********** ******* ******* then ******** **** ****** economies ** *****, ***** direct ******* ****** *** manufacturing ***** *** *******. Selling **** **** '***' channel, ******* *** ******** vendor ******* ***** *** company *** ****** ** the ***** ****'*.

Seller **** *******

******* *** ********** ***** by **** ***, ******* ** **** here*** ***** ****** **** Access (****), ****** ** ********* *** *** ******, *** ******** ******* Security ** *** ****.

******* ********* ** *** access ******** **** **** bought ******* **** *** intent ** ****, **** a ***** ** ********** the ******** *********** ******* and *********** ******** ******** rather **** ***** ** aggressive ******.

** *** **** **** owned *******, *** ******* development *** **** *****, with *** **** ******* release ****** ******** ***** ******** controller, *** ** ***** revisions ** ******* ** mainstream ********** *** ********* module *******. 

ACRE *** ***********

**** *** *** ****** explained *** **** ** IPVM, ****** **** *******'* business ***** ******** **** the **** ** ***** portfolio, *** **** **** want ** ***** ** the ********* ** ****** and **********, ********* ********* acquisitions ************* ** ****:

*** ******** *** * strategic **** *** ****. The **** **** ** were **** ** ****** Mercury ** * ******* that ** * *****, long-term ********** ******* ** ACRE ***** **** * win-win *** *** ********* involved. ** **** ******** our ***** ************ **** HID ****** ** * technology ******* *** **** transaction ******* **** ************, which *** ******** ******* Security, **** ******** ** grow. ******* *** **** a **********, **** ******* in *** **** ******; however,Mercury ******** ***** * **** ********* ******** ***** **** *** ***** ********* ** *** ********* ** ** *** ********. This sale is the next step for ACRE that aligns with the overall strategy of building a security company around our core businesses and brands. In looking to further expand the ACRE family of companies, Vanderbilt will continue to focus and build on the strengths of their video, access and intrusion portfolios. In addition, ComNet will continue its focus on building both geographically and across new vertical markets such as Power Transmission and Distribution. The ********* ********* ******* ****** *** ********** *** ****** ********* *** ******** ** ****** and we will further explore the compliments in technology that span both organizations. With that said, ACRE **** ******** ** **** *** ************ **** *** ************* ** *** ********** *** ****** ********** with similar business structures, customers and channels to market. [Emphasis IPVM]

Good *** *** ***

******** ******** ** **** is **** *** *** is * ****** **** for**** *****/*** ******, *** *********** **** an ******* *********** ********* in *** ******** ****** market.

*** *** **** *** of *** ******* ********* of ****** *********** *** readers *** ******* *******, with *********** *********** *** credentials *** ******* ** many ** *** **** markets ** ******* ******** sells ********** ********. **** an ****** ******** ***** of ****, ***'* *********** brand ***** ****** *********** and ********* ******* ** Mercury, *** ****** *********** marketshare ** *** ***** controller ******** ** ***.

Already *** ***** ******** ******

*** ** *** ********* values *** ****** ** the *** ** ** established ********** *** ********** as * *** ***** controller ******. ***'* ******** controller *****, **** *** *** ***** ******* *** ****** ********* by ****** ******** *******, and *** ******* *********** just ******* *** ********.

** ***** ** *** **** ** *** ** Mercury ****** *********** ****, *** *** ********* offer ****** **** ******* directly **** **** *****:

** **** ****, ** is ******* ** *** will ***** ** **** all ****** ** *********** offerings. *******, ***** *** exclusive *********** ** ******* partners **** **** ******* products, ** ***** ******** that *** ******* ** Mercury's ********* **** ** made *******.

Neutral **** *** ********

** **** *** ** HID's ******** ****** **********, most ******** ******* ** spoke **** ********* ******* or ***** ******** ******* for ******* ** *** takes *******.

***** **** *** *** multiple ******* ** ***** own ******** **** ** with *** **** ********, the *********** ** *** will **** ** ******** existing ************* *** ******* streams ****** **** ***** things **** *******.

Relief *** *** ** *********

*******, ******** ******** ********* relief ** **** **** Mercury *** *** **** to * ************ ********** like *** ** ********* Electric.

****** *** *********** ** Mercury's **** **** ********* for ******* *****. **** the ***** *********** ******** issues ** **** ***** *** *****, ******* **** *** parent ************ ** ****** brand ***** ***, *** ultimately ******** ****** **, Mercury ******** ** ********* partners *** **********.

*** **** **** *** does *** ****** ******* its *** ****** ********** platform ** **** ** 'safer' *** ******** ********, regardless ** *** *** business ** ************ *******.

Risk **** *** *********** *** ************

*******, *** *** * lengthy ****** ** ********** and **** ************ ************* or ******** ** ********** after ***********. ** ****** years, *** *** ********* companies **** ********** ************** *** ******* ********** ******** developer*********, **** ** *********** fold *** ******* ******** into ***, ******* **** existing ******* *** ********** or *********** ******* *********.

***** *********** ********* ****** on ******* ** ****** and ******** *** ********* management *********, *** **** of *************, **********, ** substantial ********** ** ******* as ** *********** ******** unit *** *******.

*** *** *********** ******** managing *** *** ******** business, ******** ******* **** several ******** ******* ****** HQ ********** ** ******, Texas *** * ****** of ******* ** *** credentials ******** **** ********** resulted ** *** *********** *** ******.

****

Comments (21)

* ****** **** **** happen ** *** **** of ****?  *** ***** companies ** *** *********, while *****, ** *** have ****** *** **** singular ******** ** *** industry ** ******* ****.

**** **** ** **** seen, **** **** ******* cross-selling / **-********* ** their ******* ********* ** my *** **** ***** that *** ****** ***** continue ** *** *************. Yes/no?

*** ******* * *** is ******* **** **** take *** ******* *** turn ****** *** ****** in ***** ****** *********? i.e., ****** *** *******.

*** ***** **** **** do, ******* ****** ***** more ************* ** **** Access ******* ******** ********* to *** ******. ********** while ******* ***** *** crazy ***** **** *** users.

* *** ******* ** HID ********* *** ****** so *** **** **** it :)

** ****** *** ******* Europe ******* ** *** well ***** ********** ***** comparing ** *** ** now **** **** ****** opportunity ** ****** **** in **** **** ** the *****.  

**** ***** ***** **** its *** ******* ********** hardware, ** ***** **** were ******* *********** ************?

* ***** ***** **** called *** "*" ****** (Universal).  * ***** **** are ***** ***** ********.

**, *** **.  *'** edit *** ***** **** out ** ** *****.  Thanks.

** ************* ** ***** does ***, ******** **** support **.

*********:

*** *********, ********* **** 30, ******** *** *******, filed **** ****** ** panel ************ ******* ******* access ******* ******** *****. That ******* ******* ****** of ******** *** ********* infringement.

***** ***** ** *** agreement **** *** ********, Kirmser **** ** ******* that ***** *** ******* products **** ****** ********** “for ** ***** **-**** years *** ******** *** a *** ******.”

************, *****’* **** **** continue ** ** ********* by *******. *** ***** Lenel **** *** ******** quote ** ****** ***** Universal’s *** (****) ******** to **** **** ******* panels (***-***, ***-****, *** 2220 *** ***-****), ***** and ******* **** ******** to ******* *** ************* of ***** ******** *** those *** ********* **** before *** ********* ** who *** ******** ******* on ******** ***** **** are *********.

*** ****** ******* ** good *** *******, *** and *** *****.  *** sure ** ***** *********** is *******.

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

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

*** *** ********* *** that ******* ** *******? Mercury ** '**** ********' but ** ** *** 'open ******'. * ***** be ******* *** **********. Thanks.

***** - **** ********, misspoke. ******** **** *** continues *** ****** ** not ******** *** *** proprietary ***-**-*** ****** *** offers ***** ****** ** part ** *** **** platform **********, **** ** very **** **** *** the ********. **** ****** control ***, **********,******** ******* insulated **** *** **** platform ********** **** ** Surveillance *** **** **** through *** ******* ********* from. ******* **** **** will **** **** ****** toward **** ***. 

*** ** ** "**********" that **** ****** ******* has **** ********* **** the **** ********** ** IP ************?  ** ** a ******* ********* ******** than *****:

** ** * *** more ******* ** ******* access ******* ** * door **** ** ** to **** * ****** on * **** ** a *******.  ***** *** safety *****, ***., *** to ******* **** ******** are ******** **********.  ** * camera *****, **** *** operators **** **, *** the ****** ***** *** deterrent *****.  * **** fails *** ****** **** up ****** **, *****.

****, *** *** ******** model ** ****** ******* is ******* ***** ** capitalizing ******* ***** **** hardware ***** *******.  **** requires ******* **********, ***** is **** ****** ** do **** * ************, open ****** *******.

****** *** ** *** a ********** ********* ******** - *****, ********* *** surveillance *** **** ***** the ******** *********** ********. End ***** ****** ***** systems ** *****-*******, ** they *** **** ***** monitored *** ************ ** a ******** ***** ****** their *************. ** *** major *** ** **** industry, ******, ******* ****** off ** *** *** proprietary ***** **** ******* options *** ***********, **** hurts *** ****** ********.

** **** ****** ******* manufacturers ***'* ***** ****** in *** ********* ** being ******** ********** *****, then ******, **** ** the **** ******** *** developers **** ***** ***** it *** **** ( already ****).

* ***** **** *** notion **** **** ****** has * ****** ******* both *** **** *** AHJ-wise. *** ** *** as ***********, ***** *** already ***** ********* ****** great **** ******** ******** that ** ********** ******** - ***, ***, ********, Mercury, ***. **** ******** can ** ****** **** an **** ******** ******** solution **** ************ **** on ******* ******** ******** and ********** *** ********* integrators **** ******* ******* rather **** ******* *** progress ** ******* *********** hardware *****. **** ******** has ****** ** *** other ******* ** *** industry. **** ** *** I *** ** ** "incredible" **** ****** *** held *** *** ** long. 

**** *** *** ****** explained *** **** ** IPVM, ****** **** *******'* business ***** ******** **** the **** ** ***** portfolio, *** **** **** want ** ***** ** the ********* ** ****** and **********, ********* ********* acquisitions ************* ** ****:

*** ******** *** * strategic **** *** ****. The **** **** ** were **** ** ****** Mercury ** * ******* that ** * *****, long-term ********** ******* ** ACRE ***** **** * win-win *** *** ********* involved. ** **** ******** our ***** ************ **** HID ****** ** * technology ******* *** **** transaction ******* **** ************, which *** ******** ******* Security, **** ******** ** grow. ******* *** **** a **********, **** ******* in *** **** ******; however, Mercury ******** ***** * **** ********* ******** ***** **** *** ***** ********* ** *** ********* ** ** *** ********. This sale is the next step for ACRE that aligns with the overall strategy of building a security company around our core businesses and brands. In looking to further expand the ACRE family of companies, Vanderbilt will continue to focus and build on the strengths of their video, access and intrusion portfolios. In addition, ComNet will continue its focus on building both geographically and across new vertical markets such as Power Transmission and Distribution. The ********* ********* ******* ****** *** ********** *** ****** ********* *** ******** ** ****** *** ** **** ******* explore *** *********** ** technology **** **** **** organizations. **** **** ****, ACRE **** ******** ** **** *** ************ **** *** ************* ** *** ********** *** ****** ********** **** ******* ******** **********, customers *** ******** ** market. [******** ****]

* **** **** ***** HID *** ******** **** engineering ******** **** ******* to *** *** *********** known ** *** ******** Authentication ****** **** *** for ***. *** *** hardware wasn't ***** **** **** bought ** **** **** Street *** **** ****** CodeBench ******** *** * great ***********, ** ***** the ******** ****** *** Butthead, "*** ***'* ****** a ****." * **** heard **** *** *** version * ** ****** soon, *** *** **** enough *** **. 

**** *** **** *** PAM-on-panel (** ***** ************** on *** ******)?  ** this ********, *** ********* software **** ** *** Mercury ***** ******.

** *** ******* **** up ** *** ****** for *******, *** **** not ******** ** * Federal **** *** ***** it ** **** *** on *** *** *** so *** ** **** licensed *** *** ** Lenel. ** **** *** a *** ****** ************* where ** ********* **** route ** ***** *** PAM *********, *** *** customer ** ******* ** Enterprise ******** ** **** are ******/********* ** ****** their ******* ** ***** the *** ** **** new ******. ***** ***** has updated **** ****** **** the *** **** ** will ******** ** ** a ******* ***, *** even **** ***** *** major ******** **** *** pivCLASS *******. *** **** that *** **** *** advertise, ** *** ******* drop ***** **** **** will **** **** **** expensive ************. **** **** a ****** **** ******* people *** **** *** this ***** ** *** their *** *** ***** voltage ********* ******* *** PAM *** *** ****** to ****** ***** ***** goes ***** * *****, but ***** ************ ***** still ******** *** ******* to ** ******* ** the ***, **** ** mention ** * ******* regulator. * ** **** quite ******* **** ****'* drop **** **** ** Certipath ****** ******* ******. Seems ** ** **** if **** **** **** is * ******* **** could **** ************ *** voltage ********* **** ****** the *** ** ****** yet *** ******** *******. I ***** **** ** get * **** ** customers *** **** ********* PAMs ** ******* *****. 

"**** ** * *** money, Tell *** **** *'* do
*'* ** ******** *** buy * ******* ** two.
***** '**** * *******"

-**** *******

***. *** ******** *** advice.

**** * *** *** acquisition ** ********** *** Mercury * *** ********** sure ACRE *** ********** ** form * ********** *** Lenel *** *************.  

******: **** ****** **** ~$400 ******* *** *******, according ** ******* ***** to *** *******, ****** the ****** ******** ** Mercury (*.*., ***** *** only *********** ****** ******* panel ******** *** *** depth ** ******** / installers) *** *** ********* value ** ***.

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