Ackerman Security Systems Acquired by Private Equity Firm
Toronto-based Imperial Capital Group and a partner firm purchased a majority stake in Ackerman Security for an undisclosed amount.
ATLANTA – Ackerman Security Systems, based here, completed a deal to be acquired by private equity firm Imperial Capital Group of Toronto and its partner OPTrust Private Markets Group. Terms of the transaction were not disclosed.
A group of Ackerman senior managers, including CEO Jim Callahan, will continue to own a minority stake in the company. The sellers include private equity firms Bariston Partners and Sverica International, who bought out company founder Charlie Ackerman in 2005.
“In general, private equity firms do five-year transactions. This group held on to [Ackerman] for 10 years primarily because we were the best performing fund in their portfolio,” Callahan told SSI. “It has come a time when they would like to monetize their investment.”
Founded in 1976, Ackerman has grown to more than 300 employees with approximately $3 million in recurring monthly revenue (RMR). The company entered the Washington, D.C., market in 2010. Among its customer base of 125,000 mostly residential accounts, Ackerman offers business security solutions nationwide as part of its national accounts program.
Callahan told SSI the process to find a buyer for Ackerman began about 10 months ago and resulted in “a large pool” of private equity firms showing interest as potential suitors. He said the management group felt a private equity investor was in Ackerman’s best interest as it would enable the company to continue growing instead of its account base being folded into another security provider’s operations.
“What this allows us to do is continue to use the capital and the resources that are going to be made available to us by Imperial to continue to grow out the locations we are in, which is Washington D.C and Atlanta,” Callahan said. “It allows us to stay on the forefront of technology, and we will be looking at the possibility of other markets as well.”
With the purchase, Imperial Capital makes its first foray into the security industry as a fund manager. The firm has previously focused on buy-out opportunities in the Canadian and U.S. mid-markets in the healthcare, branded consumer products and business services industries with revenue between $20 million and $200 million.
Imperial Capital Partner Glen Silvestri told SSI both OPTrust and Imperial had been studying the security space for quite some time and were looking for the right company to jump in.
“We were attracted by the stable and recession-resistant revenues the industry, but in particular Ackerman, offers. It is also an interesting time in the industry, given the increasing penetration of security with cable and telco entrants and increasing ARPU [average revenue per unit],” Silvestri said. “Ackerman has had a great track record of organic growth during that period and is poised for future growth as a differentiated service provider with an outstanding value proposition for its customers.”
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