ADT to Sell Canadian Operations to Telus Corp.
ADT has entered into a definitive agreement to sell its Canadian operations to telecom Telus Corp. for CAD $700 million in cash.
BOCA RATON, Fla. — ADT (NYSE: ADT) announces it has entered into a definitive agreement to sell ADT Security Services Canada (ADT Canada) to Telus Corp. for approximately CAD $700 million in cash, subject to certain adjustments. The transaction comprises all of ADT Canada’s operations and assets.
In 2014, ADT acquired Canada-based Reliance Protectron Security Services and its 400,000 residential and commercial customers for CAD $555 million.
“Opportunities continue to develop for ADT in the areas of smart home integration, the expansion of the home security business into new demographics and ADT’s growth in commercial security,” says Jim DeVries, president and CEO, ADT. “The sale of our more capital intensive Canadian operations enables us to sharpen our focus on the exciting growth and higher margin opportunities in the U.S., where we can more efficiently invest our time and resources. Importantly, these emerging opportunities are ideal for leveraging the trusted ADT brand as we continue generating strong free cash flow to drive shareholder value over the long term.”
Telus Corp., a Canadian telecom, entered the electronic security industry last January after the purchase of AlarmForce accounts from a competing telecom. It launched its first two security businesses later in the year.
ADT also announced that its Board of Directors authorized a one-time special dividend of up to $550 million and plans to set the dividend at $0.70 per share. The special dividend is conditioned upon the closing of the transaction and is subject to subsequent corporate action, and therefore may not be in that amount, or occur at all, according to the company.
Details of the special dividend, including the record date for shareholders eligible to receive the special dividend and the payment date of the special dividend, will be provided in conjunction with the closing of the transaction.
For the fiscal year ended December 31, 2018, ADT Canada generated revenue of USD $229 million.
The transaction is expected to close in the fourth quarter of 2019, subject to customary closing conditions and other business requirements, including approval of the transaction by the Canadian Competition Bureau.
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