Sometimes bigger is better.
"These acquisitions are the continuation of an effort initiated eight years ago to create a full integrated loss prevention company worldwide," said Ronald G. Assaf, Sensormatic's president and CEO. "We have been systematically building up our integrated loss prevention capabilities."
Automated Security (Holdings) PLC is a multinational security alarm monitoring and loss prevention corporation headquartered in the United Kingdom. Under the terms of the agreement, Sensormatic will acquire Automated Security's loss prevention operations, comprised primarily of its electronic article surveillance (EAS) and CCTV businesses. The divisions being acquired had combined revenues of approximately $105 million for the year that ended May 31, 1991.
The purchase price for the Automated Security businesses is 150[pounds] million (approximately $265.5 million), payable by 50[pounds] million in cash and 100[pounds] million in a one-year promissory note.
Short-term financing will be used to finance the cash required at closing. The proceeds of a planned public offering of Sensormatic common stock will be used to repay most of the debt incurred in the transaction.
Included in the acquisition is Automated Security's 30 percent interest in Security Tag Systems Inc., a Us-based EAS supplier.
BURLE Industries Inc. is the leading manufacturer of CCTV equipment and accessories in the United States. Headquartered in Lancaster, PA, Burle features a comprehensive CCTV product line and also has a strong market presence, as well as manufacturing operations in the United States and Europe. BURLE revenues were approximately $145 million for the year that ended June 30, 1991.
In the merger, Sensormatic would acquire all the capital stock of BURLE in exchange for 3,314,000 shares of Sensormatic common stock. The transaction is expected to be accounted for as a pooling of interests.
In a conference call with the trade press on the day of the announcement, Dennis Gillette, senior vice president of Sensormatic, said, "the [companies'] names will stand on their own." He said Sensormatic realizes that both companies have strong name recognition with the public.
Gillette went on to explain that Sensormatic plans to retain the management teams of both companies. "Sensormatic is pleased with the management personnel and what they've accomplished at BURLE." Gillette similarly praised Automated Security's management.
Tom Buffett, CEO of Automated Security, and Erich Burlinger, CEO of BURLE, will join the board of directors of Sensormatic to further facilitate the integration of the three companies.
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|Title Annotation:||corporate mergers|
|Date:||Jul 1, 1992|
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