Securitas Buys Diebold Security NA for $350M

Author: John Honovich, Published on Oct 26, 2015

Securitas, one of the largest security guard companies in the world, with 300,000+ employees, has acquired one of the largest North American integration business from Diebold (see Diebold press release and Securitas press release).

In this note, we examine the relative valuation of the deal, why Securitas is focusing hard on technology and what this means for the industry.

*********, *** ** *** ******* ******** ***** ********* ** *** world, **** ***,***+ *********, *** ******** *** ** *** ******* North ******** *********** ******** **** ******* (********** ***** ******************* ***** *******).

** **** ****, ** ******* *** ******** ********* ** *** deal, *** ********* ** ******** **** ** ********** *** **** this ***** *** *** ********.

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

Financial ********

********* ** ****** $*** ******* *** *** * ******** **** does ~$*** ******* *** ****** *******. ** ******** *** ****** margin ** ~*%, ***** *** ****** ********* ********* *****.

******* ****** **** *** ** ******** ******** *** ******* *** is ******** *** **** ** *** *******. ******* ****** *** barely ***** *** ***** ** **** *% ** **% ****** would ** *********** **** ***** ***********.

*********

********** ********** **** ** ** ~** ***** ** ****, ** this ** * **********, ** *** * ********** ****, ***** for *********. ** ********, ************* ********* **** **** ****** **********, often ** *** ** ***** ***** *** ** **** *****, much ******, *.*., **** **** ** ~** *****.

**** / ******

**** ******** *** ~**% ** *******'* ******* ***** (~$* ******* USD), ** ** *** * ********** ***** **** ** ***** company, *** *** ***** **** *****.

****** ********* ** ***** ** ** ****** **** ******* (********* ~8.2 ******* *** ****** *****), **** ** * **** **** impactful **** *** *********' ******* ***** ** ***-***** ********. ***** to **** ****, **** ******* ** ********* *** ***** ***** (~10%), ** *** ******* ** ******** ******** ************* ******* ***** integrator **********.

Diebold ******** ***

*** ******* ** ******** ** **** ** ***** "******* *.*", ********* ***** ********** ****** ***** **********. ** **** ******* in ******* ***, **** ****** **** ** "***** *** ********* ** *** dynamic****-***************" ***** ********* * ********** *** ***** ******* *********** *********.

*** ***** ***** ** ******* ***'* ***** ** *** **** did *** **** ********* * ***** / ********** **** *** German ****** ****** *****:

Securitas ******* ** ****

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

"********** ** ********* *** ******** ******** ***** ** * ***** trend ** *** ******** ********: ***** ** ******** **** ********* and *******, **** *** ***** *** *********** ***** ****. ********** is ********** **** *** ******** **** *********"

**** ***** ** **** ***** **** ****** **** ****** ****** titled "********* ******** ******* *** **********". *** ***** ** ********** *** ***** - ********* ***** to ***** ***** ********* ***** **** ****** ** ****. ** challenging ** *** **** **** *** ** ******** *******, ** is ********* ***** * *** **** ********** **** ******* ******** guards ********.

********* *** ~*,*** ********** ********* (*** ** ~***,*** *****) ***** and **** *** ** ****** ~*,***, * ******* ********, ****** still ***** ******** ** ***** *******'* ****.

******, ********* ** **** ***** ******* ** ***** *** ***** analytics:

"********** ** ********** **** *** ******** **** *********, *** ** combination **** * *** ********** ** ****-******** ******* ********, *** transmission ** ****** *** ****** ** ******** **** ****** *** secure.... ***** ********* *** *********** ******* *** ******** ** ** determine ********** ** ********* ******** ** ** ***** *****, ******* minimizing *** **** ** ******** ************. ** *****, ** *** detect ********* ***** ****** ** *******, *** ** ** **** cost-efficiently **** ******."

*** ******* ** ********** ******** ********, ******, **** ***** ********* tangentially **** ** ******* **** *** **** *** **** ********** there, ****** *** **** ** ***** ** ********** *** ********* such ********** *****.

******, ***** ********* *****, ** ***** ******* ********** ******* ************ are ******.

********

**********, ********* **** ** **** * **** ****** ******** *********** arm ** *** ***** *** ** **** ** ***, ********* ** *** **** ****** **** *** ****** $* *******, **** ** ** ****** by ******* ***** *** ******.

Guards ** ****

*********' **** **** *** ********* ***** ***** **** * ********* upside *** *** **** ** ********** ******* ** **** ** is ******** ************ ********** ** * ***** **** ********** *** guards.

Comments (16)

Undisclosed 1 Integrator

| 10/26/15 12:04pm

*'** **** **** **** ***** ********* *** *** ***'* **** wanted ** ******* ***** ******** **** **********, ***** *** (****** guard *********) ** *** ***** ***** ******* *** ***********. ***** seemed ** **** ***. *** ***** ********* ***** ******* **** some ***** ********** *** ****** ***** *** ****** ****, *** would **** ******* *** ******** ********* **** *** ******** ***** up *** ****** *** ***** **** ****** **** *******, *** the **** **** **** *** *** ** *** **** ******* ended ** ********** ***** *** ********** ********. ** *** * bid ***** ********* *** ***** ********, *** * ***** * good **** *** ** ** **** ***** *********** **** ** integrator ****** **** **** **** **** **** *******.

** ***** *** ********* ***** ****** ******* ** *** **********. But * ***** ** ***** ** **** ************* *****. **** big ********* **** ** ** **** ***** *** ****** ****** in ***** ********, **** **** *** ***, ***** *****'* **** a ********'* ****** ***** **** ****. ** ***** * ****** for *********** *** *** ***** ** *** ****** **** *** don't ***** **** ***** ********** ********* (**** ** ******* ************ or **** ***** ******* ************).

John Honovich

IPVM Admin | In reply to Undisclosed 1 Integrator | 10/26/15 12:44pm

*******'* *** **** *** ******* **** *** *********** ******** **** be *** ********** **** *** ***** ********, ********* ******** ***** teams.

** *** ******, ** **** *******, *** **** ***** ************ integrate *** ***, **** ***** ** **** ********. * ***** think **** ***** **** ** ********** **** ** **** *****, given ***** ********* *******.

Undisclosed 1 Integrator

| 10/26/15 12:48pm

******, *** **** *** *** ** ** * ******** ******** for ****** *****, ** **** **** ***'* *** * ****** on ** *** ****** ** **** ** ***.

Thumbnail silva18c

Michael Silva

| 10/26/15 01:47pm

***** **** ** *** ** *** ***** **'*, ***** ********* have ***** ** ***** *** ********** ******** ******* ******, ****** that **** ****** ** ** "***** ******** ********* *********".

**** *** **********, ***** ******* ***** ******* ********* **** ********* poorly, ********* ******** ******* *************, *** ********* **** **** ** acceptable ***** ** *******. ******* ****** **** * *** *****, the ***** ******* ***** *** *** ******* ********, ****** ** wants ** ***** ** *** "**** ************". * **** **** this ******** ****** ****** ****** ** ***** **** *** **** 40 *****.

******** ******** ***** ********** *** ******** * ******** ******* ******** are *** ******** ********* ******. ******** ******* ********* *** *********** like *** ***** ******** ****** ****** ******** ****** ** ****. Executives ** *** ***** ******** *** **** **** ** *********** revenue ******* *** ********** ****** *******. **** *** ***** ******* by *** *********** ** *** ******* ************ ******** ("*** *** it **** *** * ***** ** ******* * ****** ** one ********, *** * ***** ** ******* *** **** ****** at ******* ********?...)

Undisclosed 2 Manufacturer

| 10/26/15 01:55pm
********* ***** * ****** ***** ********** ****** *** *** **** expanding **** ********.

John Honovich

IPVM Admin | 10/26/15 06:44pm

***, *** *** ********************* / ************'* ***** ******** ****** *********** ******* ** $*** ******* ** more, ***** ** ********* *** *** **** ** ******** **.

Undisclosed 3

| 10/26/15 07:09pm

**********, ********* **** ** **** * **** ****** ******** *********** arm ** *** ***** *** ** **** ** ***, **** tried ** *** **** **** ** **** *** ****** $* billion, **** ** ** ****** ** ******* ***** *** ******.

*****, *****

*********’ ******* ************, ****** ******* *** ****** **********, *** **** among *** ***-*** ****** ** ********, ********* ** *********.

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

Thumbnail pp 5

Brian Rhodes

IPVMU Certified / IPVM Admin | 10/26/15 07:30pm

** ** ******, ******* **** ** **** * *********** ******** in *******. *******, **** *** **** ****** ** ** ****'** lost **** ** ***** ********.

* **** ******** ******** ************ **** **** ******* ** ***** integrators. **, ***** ******** **** **** *******.

John Honovich

IPVM Admin | 10/26/15 10:32pm

*** *********** ***** * **** ***** ** **** ******* *** back ******** / ***** ****** ************* ** *** *********** / integration ******** **** *** **** *** *****. ** ******* *** that **** *** **** ** '******* *.*' ******* ** ** this **** ***. ***** ******* **** ********* ******** *****-**** *************, though ** ***** ******** *****, **** *** **** ******* ***** ability *** ****-**** ******* *** *** ******* ********* ** **-****** / ******** ******** ** ******** ******** ** ** ** *** a ******** ********.

Mark Jones

| 10/27/15 01:02pm

* **** **** ** ******** ******* ******* *** ** *****. They **** ******* ** ** ****** *****. ** ***** ********, they **** **** **** ** ***** ******* ** **** ********* in *** **** ****** ******. *** ***** **** **** ******* a ***-**** **** *** ******* *********. *** **** ********* ** which *** ****** *** *** ******* *** ******** ********. **** offered *** *****, *** **********, *** *****-***, *** *****, *** pens *** *** ********. **** ********* **** ** **-**** ********* business **** ********* *** *** *** *************. **** ******* *** the ******* ******** ***** **** * **** **** ***. *** the **** *** ****** *** *** *** **'* ********** *****. Customers **** ********* **** ** **** "** * **** ** have **** **-**** *** *** ***, *** *** **** **** them ****** *** ******** ** ****." ** *** ***** ***** and * *** ** **** ** ***** **** ************.

* ***'* ******* ** **** **** ********* *** ** ***** for *** ******** *******. ** ******** ***** ** **** **** use ** ** **** ********** *** ***** ********. **** ** only *******. **** ******** **** **** ** **** ***** *** them **** **** ***** ***** **** ** **** ** ***** own. ********* ************ **** **** ** ****, *** ***** **** guards ** ******* **** ****. *** ***, ** **** ** we *** ****.....

** *** **** ****, ***** *** **** ******* *********. **** are *** **** ***** ** *** **** *** ****. * lot ** **** *** **** **** ** **** **** **. Don't ****** **** ** **** **** **** *** ****. **** won't.

** *** **** **** **** ***** ** **** ********, *** we ** ***** **** ****, ****** ***** **** *** * little, **** * ****** ******. **** **** ** ****, *** ATM, ** ** ****** ***** *** **** ** ****. ** least * *** ***-**** ******* ********* **** **** ****** *** landscape ***; **** ***** ** ******* ** **** ** *******. Over ****, **** **** **** **** **********. * ******** **** never ******* * ***** **** ** *** **.

Undisclosed 4 Integrator

| 10/27/15 11:20pm

********* ********* * ***** ***** ** *-****** (***** ********** **** out ** ********* **) * ****** **** **** * **** ago *** *** ***** **** ******* ** *** ********** *****. Their **** *********** **** ** *** ******** **** **** **** largely * ********, ********* ** * ***** ****** ** ******* clients. ******* *** ***** *** ****** ** **** *********, ***... they *** ********** ** ******** *** ************* ********** **** ***** competitors. ** **** ******* **** ******** * ******** *** ****** and ****** ******* *** * *** ** ***** ******* *** prospective ******* **** ** ******** **** (*********) **** ******** ***** own ********, **** * ****** **** **** ****. *******!

Undisclosed 3

| 10/28/15 01:41am

**** ***** ** ******. **'* **** ** **** ******* ***** with * ****** ******* **** ********* *****.

**** *** ******* ***** ** "** ****** ****** ** **** the ********, ** ** **** **!", ***** **** *************** **************** of ******* ** ******* * ****** **** **** **** ***** give...

@****, ********* *** *****, *** ********* ******* *************, ********* *** Diebold **** ******* * ***** ********.

****, ** ***** ******* ** *****, *'* ******** *** ******* of ****** *** ***** **** * ****** ***** **** ** in *** ****** ******.

John Honovich

IPVM Admin | In reply to Undisclosed 3 | 10/28/15 04:14am

"****, ** ***** ******* ** *****, *'* ******** *** ******* of ****** *** ***** **** * ****** ***** **** ** in *** ****** ******."

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

*** ******* ************ ** *****, ********** ****** ** *** ** Hesse ** * ***********.

*.*. * **** ****** **** ********** ** *****... * **** time ***.

Undisclosed 3

In reply to John Honovich | 10/28/15 04:45am

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

***, ****** **** *****. ****** *** ******* ****** ***** **** to ** ***** *******; *** ********* *** ********* ** ******* ES, **** ******. ***** *.*. *** ***** ** **** ************, e.g. '*********'.

**** ******* **** ** *** ** *** ****** ** ***** sentence:

"**'* * ***** ********* ** *** ******* *.* ************** ***** we **** '**** ** *** *******> ** *** *******...' ?"

John Honovich

IPVM Admin | In reply to Undisclosed 3 | 10/28/15 11:44am

** ** '**** *****', **** *** ***'* **** *******'* ********* talk? :)

**** *** ******* **** **** ******** *********** ** **** *** run ****** *********.

****'* **** ** ******** **, ****** *** *** **** ********** are (***** * ******* ** * **** ** ********* / the ****** ** ***** ******** *********** ********):

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

JOHN Williams

In reply to John Honovich | 07/07/16 11:55pm

****,

* ***** ** *** ***** *** ********* *** *** ************ but ****** *** ****** ** ******* ******* **** ***** ***'* be *** ***.

**** ** ****** ***** ** *** * *** ** ****** but *** ***** ** ******, **** **'* ********, ****** ** value *** ****** **. *** **** ***** ** *** ****** sheet. **** * ********* ******* *** *** * ******* *** appreciate.

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