Protection One to Buy Integrated Alarm for $85M
Protection One Inc. announces it will purchase Integrated Alarm Services Group Inc. (IASG) of Albany, N.Y. The deal, which is expected to be completed in the second quarter of 2007, will require the approval of IASG’s shareholders and regulatory approval.
Terms of the deal call for each share of Integrated Alarm to be exchanged for 0.29 shares of Protection One. Stock in Protection One closed Dec. 20 at $12 a share, putting the current value of the deal at $3.48 a share, or $84.8 million.
After the transaction, there will be about 25.3 million shares of Protection One stock outstanding, of which IASG and Protection One shareholders will own about 28 percent and 72 percent, respectively. It is expected the merged company will be traded on Nasdaq.
The combined company, which will be led by current Protection One President and CEO Richard Ginsburg, will have annual revenue of about $365 million and recurring monthly revenue (RMR) of about $27 million, according to a company statement. It will have 73 branches across the country, six alarm monitoring response centers, plus a dedicated disaster recovery center. Efficiencies created by the deal are expected to create net annualized savings of about $12 million, the company says.
“Wholesale operations will continue to operate separately from the other divisions of the company,” Ginsburg says. “We believe merging our wholesale entities will allow independent alarm companies to benefit from the scale of that combined business as well as other benefits we intend to offer through our buying power and increased size.”
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