NEWTOWN SQUARE, Pa. — Alarm Capital Alliance (ACA) has entered the New Mexico market with its purchase of 1,400 accounts of primarily residential customers from Scottsdale, Ariz.-based Safeguard Security.
The transaction brings in more than $50,000 in recurring monthly revenue (RMR). As part of the deal, ACA will maintain Safeguard Security’s New Mexico branch, allowing the firm to implement its marketing and growth strategies in the region.
ACA came into the accounts after Safeguard Security CEO John Jennings, who also serves as a member of SSI’s Editorial Advisory Board, decided to divest from its New Mexico operations.
“Slow growth became a distraction from our other core business in Arizona,” he tells SSI.
Jennings takes pride in caring for his clients; thus, he wanted to select a partner that would ensure the continuation of the superior customer service his clients received regularly, he says. The experience of ACA’s acquisitions team appealed to Jennings, so he contacted the firm about the sale.
As it turns out, ACA had been seeking to enter into the New Mexico market for years. When acquiring, the firm always looks for accounts that have low attrition, good geographic concentration and long-term customers, and the Safeguard Security accounts fit the bill, Kelly Bond, senior vice president of sales and marketing for ACA tells SSI.
“We don’t want to just buy accounts and let the engine go away,” she says. “We want to have an opportunity to continue to grow in the market, and we saw this acquisition as that perfect opportunity. We’re excited to learn more about the marketplace and develop additional, strategic partnerships.”
With 2014 on the horizon, ACA will continue to seek acquisition and partnering opportunities, although Bond, who oversaw the acquisition and contract negotiations for this transaction, notes that there wasn’t too much M&A activity in 2013.
“This has been a slow activity year for acquisitions,” she says. “I believe that a lot of dealers were opting to ride the wave and continue to grow their business versus getting out. I hope we see more acquisition opportunities in 2014.”
That said, for companies contemplating selling their alarm accounts, ACA can serve as a good partner because of the firm’s experience, knowledge and flexibility, Bond says. In fact, the firm’s goal is to impart any knowledge to alarm business owners to help make their businesses as valuable as possible.
“We really want to build relationships in advance of companies wanting to sell,” Bond explains. “We’ve learned so much through the years on all the transactions that we’ve done that we are as much consultants as we are buyers.”
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