Tyco Int’l Ltd. has entered into a definitive agreement with Cambridge Protection Industries LLC, a portfolio company of GTCR Golder Rauner LLC, to acquire its electronic security systems businesses, which, including SecurityLink, provide services to approximately one million residential, commercial and government customers.
The transaction is valued at approximately $1 billion and is contingent upon customary regulatory review. The businesses have annual revenues of approximately $500 million. In January, Cambridge acquired SecurityLink unit from Ameritech Corp., a subsidiary of SBC Communications Inc.
“The addition of SecurityLink and the other Cambridge business lines continues our strategy of expanding our base of recurring revenues. Also, as with our existing ADT operations, we expect this business to generate healthy organic growth with attractive incremental margins,” says L. Dennis Kozlowski, Tyco’s chairman and CEO.
“Looking at the near-term, we expect the transaction will be immediately accretive to Tyco’s earnings per share and free cash flow per share. The integration of the Cambridge businesses with ADT will provide product, service and operational synergies, which will result in ongoing positive benefits to Tyco shareholders.”
Tyco is a diversified manufacturing and service company.