Top US Integrator Acquired by European Conglomerate

Author: John Honovich, Published on Nov 18, 2009

Adesta, one of the top US integrators and representative of network convergence was acquired by European based conglomerate G4S. In the US, Adesta is well known as a major player in the high-end integration of government, military and industrial systems.

G4S paid 'total cash considerations' of $66 Million USD for Adesta. Adesta reported $92 Million USD revenues in 2008.

Compare to Henry Brother, a publicly traded company is valued at significantly less Prices to Sales than Adesta (.72 for Adesta vs. .43 for Henry Brothers).

For an extensive discussion and interview with Adesta's CEO, see SSN's report and analysis on the GS4 / Adesta acquisition.

SSN discusses the role of recurring monthly revenue and the implicit valuation of RMR in that deal. While the security industry is infatuated with RMR, given Adesta's low RMR (Adesta reports only 10% to 15% of revenue was RMR), it's doubtful Adesta's recurring revenue was a major factor.

Interestingly, famous security analyst Jeff Kessler criticized the deal saying, "If there’s a lesson to be learned here, it’s how a great company like Adesta probably should have gone at a high price but didn’t because they didn’t have a lot of recurring revenue." Kessler contends that a "typical installation company would derive at least 25% of its revenue from recurring revenue."

In my personal experience running an integrator, I think it is difficult to generate a significant percentage of recurring revenue when you are a fast growing company like Adesta. Big projects are the quickest drivers of growth. Integrators could certainly have larger percentages of recurring revenue but generally at the expense of dramatically less total revenue.

Compare to our recent examination of "Should Integrators focus on recurring revenue?"

Comments : PRO Members only. Login. or Join.

Related Reports on Integrators

Silicon Valley Cybersecurity Insurance Startup Coalition Profile on Mar 20, 2019
Many industry people believe cybersecurity insurance is not worth it, as the voting and debate in our Cybersecurity Insurance For Security...
Top Metrics For Ensuring Integrator Profitability - Statistics on Mar 20, 2019
How do integrators ensure the profitability of their projects? As part of our profitability study, 100+ integrators answered the following...
Genetec Security Center 5.8 Tested on Mar 19, 2019
Genetec has released Version 5.8. This comes after a wait of more than a year that caused frustrations for many Genetec partners. Our previous...
Large US University End-User Video Surveillance Interview on Mar 18, 2019
Schools have become targets in modern days of active shooters and terrorist fears. The need for video and access security is high. Universities...
Hikvision Favorability Results 2019 on Mar 18, 2019
Hikvision favorability results declined significantly in IPVM's 2019 study of 200+ integrators. While in 2017 Hikvision's favorability was...
ONVIF Favorability Results 2019 on Mar 15, 2019
In the past decade, ONVIF has grown from a reaction to the outside Cisco-lead PSIA challenge, to being the de facto video surveillance standard...
City Physical Security Manager Interview on Mar 14, 2019
This physical security pro is the Physical Security Manager for the City of Calgary. He is a criminologist by training with an ASIS CPP credential....
Integrator Profitability Bonuses - Statistics on Mar 13, 2019
While winning projects typically gets the most attention, how profitable those jobs turn out to be is key to the long-term success of integrators....
Network Optix Favorability Results 2019 on Mar 11, 2019
Network Optix is arguably the last new VMS. Founded in 2010, more than a decade after most client/server VMS offerings, the company has become a...
BCDVideo Expansion And Switch From HP To Dell Examined on Mar 11, 2019
BCDVideo says they have more than tripled revenue in the past 5 years and are continuing to grow, powered most recently by switching their lead...

Most Recent Industry Reports

Avigilon Launches 'Renewed Products Program' on Mar 19, 2019
There are lots of 'pre-owned' cars but pre-owned IP cameras? While such programs are common in other industries, in video surveillance, they are...
Hanwha Tax Evasion Probe, Camera Division Implicated on Mar 19, 2019
A Hanwha group subsidiary was raided as part of a tax evasion probe. While a Korean news media report listed the raided entity as 'Hanwha...
Genetec Security Center 5.8 Tested on Mar 19, 2019
Genetec has released Version 5.8. This comes after a wait of more than a year that caused frustrations for many Genetec partners. Our previous...
Retired Mercury President Returns As Open Options President on Mar 18, 2019
Open Options experienced major changes in 2018, including being acquired by ACRE and losing its President and General Manager, John Berman who...
Large US University End-User Video Surveillance Interview on Mar 18, 2019
Schools have become targets in modern days of active shooters and terrorist fears. The need for video and access security is high. Universities...
Hikvision Favorability Results 2019 on Mar 18, 2019
Hikvision favorability results declined significantly in IPVM's 2019 study of 200+ integrators. While in 2017 Hikvision's favorability was...
ONVIF Favorability Results 2019 on Mar 15, 2019
In the past decade, ONVIF has grown from a reaction to the outside Cisco-lead PSIA challenge, to being the de facto video surveillance standard...
Installation Course - Last Chance on Mar 14, 2019
This is the last chance to register for the March Installation course. This is a unique installation course in a market where little practical...
City Physical Security Manager Interview on Mar 14, 2019
This physical security pro is the Physical Security Manager for the City of Calgary. He is a criminologist by training with an ASIS CPP credential....
US Drafting Separate Rule for NDAA Dahua/Hikvision 'Blacklist' on Mar 14, 2019
The most debated provision of the NDAA ban of Dahua, Hikvision, Huawei, et al. is the so-called 'blacklist' provision which would ban any company...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact