Industry Reaction Rolls in on ADT/Broadview Deal
By Kevin Campbell at SDM Magazine
It's not that often, especially given the current economic climate, that two major national players in an industry get together through acquisition. Yet, as it was widely reported last week, that's exactly what happened in the security industry as number one ADT acquired number two Broadview Security for $2 billion.
Now that the dust has settled and folks have had some time to reflect on the deal, the reaction to last week's announcement seems to be a positive, if not surprised, one. How the two biggest national players in the industry kept their big deal a big secret we may never know. But what some of the experts SDM has spoken with have said is that, in the grand scheme, it's good for the industry.
"We've seen periods or cycles of consolidation in the industry over the years, and both then and now I think what it really does is reinforce the value of RMR with the investment community that watches our space," says Jim Callahan, chief operating officer of Ackerman Security Systems, Atlanta. "The result is that the industry has always gotten stronger. So we certainly see nothing negative; only positives coming from it."
Others view the deal from a competitive standpoint. Fewer competitors can mean more business for other dealers. But other benefits come along with it, too.
"For the rest of the industry, it's good. It's just one less competitor out there, and a big one," says Bob Bonifas, CEO and chairman of the board of Aurora, Ill.-based Alarm Detection Systems Inc. A big one, indeed. And that may become a factor for many security customers, says Lessing Gold, a partner with the legal firm Mitchell Silberberg & Knupp LLP and SDM's legal columnist.