NEW BRITAIN, Conn. — As it strives to expand globally, Stanley Black & Decker placed a $1.2 billion cash bid for systems integrator Niscayah.
Endorsed by an independent committee of Niscayah's board of directors, the bid trumped a $907 million bid by Swedish guard services company Securitas, Bloomberg reports. Securitas, which placed its bid on May 16, had hopes of reclaiming the integrated security solutions provider, which spun off from Niscayah in 2006. The company is still considering responding to the rival bid; however, Securitas has no plans to increase its bid offer, according to Financial Times.
As one of the largest access control and video surveillance providers in Europe, Niscayah has brought in estimated revenue of $1 billion in 2011. Expected to finalize in September 2011, the deal will give Stanley, parent company of Stanley CSS, ownership of more than 90 percent of Niscayah shares. It would also give Stanley a platform for global expansion in the growing market for security technology systems, Stanley Black & Decker President and CEO John Lundgren says.
"Niscayah is an ideal fit with our Convergent Security Solutions business," he says. "It brings complementary geographic strength and services, affords substantial synergies and strengthens our customer value proposition. It also enhances our growth potential in a highly attractive commercial sector."
Excluding Stanley Works' $4.4 billion purchase of Black & Decker Corp. in 2009, this is the largest deal for the company to date. The bid shows how focused Stanley is to become the most dominant provider of security services, according to independent security consultant and SSI Monitoring Matters columnist Peter Giacalone.
"The company has been extremely diligent in its approach of carefully acquiring companies," he tells SSI. "It hasn't gone on a wild acquisition trail like a lot of new entrants to the business sometimes do. Stanley is becoming a blended company that provides high-end integration along with traditional security work. It's not doing that from a haphazard standpoint; Stanley's very focused."
Electronic security industry analyst and SSI Hall of Famer Sandy Jones agrees, noting that Stanley will likely continue to grow organically and through acquisitions.
"The company stated that it wanted to expand in Europe, and it has by making a couple of smaller purchases in Europe," she tells SSI. "The key really is that this positions Stanley as a well-established global business. Although, I do think it will take time to merge Niscayah into Stanley, find the synergies and new opportunities, and shed the overlap."
Stanley, joined by buyout firms Carlyle and Clayton Dubilier & Rice, had also placed a bid to purchase Swedish alarm company Securitas Direct, formerly part of Securitas, the New York Times reports. However, EQT, the Swedish private equity firm that owns Securitas Direct, agreed to sell the alarm system company to Bain Capital and Hellman & Friedman for $3.4 billion.