Security and protection services provider The ADT Corporation (ADT) recently sealed the acquisition of Reliance Protectron, Inc. – one of the largest security monitoring and installation companies in Canada. ADT acquired the Canadian firm from Reliance Comfort Limited Partnership, a portfolio company of investment funds managed by Alinda Capital Partners – one of the world’s largest and most experienced infrastructure investment firms.
With the deal, ADT has strengthened its Canadian presence to better serve over 800,000 local customers with the best of products and solutions along with superior customer service in the security industry. In addition, the strategic buy will offer a steady revenue stream to ADT as Protectron reportedly has higher levels of customer retention than other major players in North America. Post-acquisition, the Canadian firm will continue to use the Protectron brand under ADT ownership.
ADT believes monitored security and home/business automation services remain grossly under-penetrated in North American households. In addition, rising concerns about crime and security issues (especially by an aging population), increasing customer interest in lifestyle and business productivity, and technology advancements are likely to support the higher penetration of interactive services and home/business automation. As such, the company envisions significant growth potential and intends to capitalize on this opportunity by leveraging on its efficient operating model and lower technology costs over time. These would then enable the company to considerably reduce the cost of basic installation and services, thereby making it affordable for a wider market acceptance by a larger portion of households and businesses.
Headquartered in Boca Raton, FL, ADT offers electronic security products along with a wide range of interactive home and business automation and monitoring services for residences and small businesses in the U.S. and Canada.
ADT’s electronic security and home/business automation solutions primarily include installation and monitoring of residential and small business security and premises automation systems. These products are designed to detect intrusion; control access; react to movement, smoke, carbon monoxide, flooding, temperature and other environmental conditions and hazards; and address personal emergencies, such as injuries, medical emergencies or incapacitation.
ADT currently carries a Zacks Rank #3 (Hold). Other stocks that are worth considering in the industry include Cintas Corp. (CTAS), Stantec Inc. (STN) and Huron Consulting Group Inc (HURN), each carrying a Zacks Rank #2 (Buy).
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