AlarmForce to Be Acquired by Canadian Telecom Giant BCE
AlarmForce, among the largest home and business security companies in Canada, has 100,000+ subscribers. The all-cash offer is worth $184 million.
MONTRÉAL and TORONTO — AlarmForce Industries (OTCPK: ARFCF), a leading provider of home security and monitoring services in Canada, has struck a deal to be acquired by Canadian telecom giant BCE (NYSE: BCE; TSX: BCE) for approximately $184 million.
BCE, formerly Bell Canada Enterprises, is a provider of broadband wireless, TV, Internet and business communication services from Bell Canada, Bell Aliant and Bell MTS. Bell Media is Canada’s leading multimedia company with assets in television, radio, out-of-home and digital media.
BCE currently provides residential and business customers in Atlantic Canada and Manitoba with security and monitoring services from Bell Aliant NextGen Home Security and AAA Security, a Bell MTS company. The telecom says combining the assets and experience of AlarmForce with its own strength in networks, customer service and distribution will enable it to quickly expand into the connected home sector in Ontario and Québec.
“Bell is excited to welcome the AlarmForce team as we pursue the significant growth and innovation opportunities represented by the connected home. It’s a natural next step for Bell as one of Canada’s most trusted brands in residential services,” George Cope, president and CEO of BCE and Bell Canada, says in a statement. “Leveraging Bell’s network and service leadership and our place in millions of Canadian homes, we look forward to growing our nascent position in security and automation services to ensure Bell residential customers are at the leading edge of connected home innovation.”
AlarmForce is said to be among the largest home and business security companies in Canada with more than 100,000 subscribers. The Toronto-based company’s portfolio of services includes intrusion and fire/life-safety alarms; home automation services including lighting, climate and lock control systems; and in-home and mobile medical alert systems.
In June, AlarmForce sold its U.S.-based subscriber accounts to Select Security for $11.6 million (approximately $15.3 million CAD). The transaction added about 28,000 customers to Select Security’s ranks.
Flashback: AlarmForce Admits to Wrongfully Charging Monitoring Fees After Subscription Cancellations
Under terms of BCE’s all-cash offer, the telecom will acquire all the issued and outstanding common shares of AlarmForce for $16 per share. AlarmForce shareholders can choose to receive BCE common shares instead of cash, subject to proration, and capped at 49.5% of the total equity value.
Approval is still required by AlarmForce shareholders; customary closing conditions apply. If approved, the transaction is expected to close in early January 2018.
AlarmForce says the BCE purchase price represents a 71% premium to its closing share price of $9.34 on Nov. 6 and a 70% premium to the 20-day volume weighted average price for the period ending Nov. 6.
“This transaction validates the hard work that all of our employees have done over the past couple of years to position AlarmForce for future success. In addition, our subscribers can expect to benefit from the breadth of the Bell customer offering across many bundled services,” says Graham Badun, president and CEO of AlarmForce.
Imperial Capital and National Bank Financial served as financial advisors for AlarmForce and issued fairness opinions on the transaction.
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