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2014 was a year for eye-popping merger and acquisition (M&A) activity in the security space. The big deals of the year included some of the largest names in the industry. One name is larger than any in the security market – Google, which made not one but two acquisitions this year that could impact the future security market.
It was also the year that a smaller player in the video camera market (although a huge familiar brand overall) bought a large, open systems VMS company (to almost everyone’s surprise). There was major activity on both sides of the Atlantic, impacting a wide range of industry sectors, from video to access control to home security. It was a year for acquisition and reinvention, for mergers and management refocus. And it was the year that Samsung stopped owning Samsung Techwin.
Let’s take a look at the Top 10 M&A stories of 2014 …
When Canon, a fairly small player in the video surveillance market, announced plans for its European subsidiary to buy open systems company Milestone Systems, it sent shock waves through the market. Obviously Canon is signaling its intent to become a larger player in surveillance, but what does the move mean for the long-term viability of Milestone’s open systems approach? Can an open systems company be owned by a camera company and keep its business approach intact? Yes, according to the Milestone announcement: “Canon respects how we built our business with our partners and supports our strategy of providing open platform solutions.”
2. Vanderbilt Acquires Siemens' Security Products
Siemens’ Security Products is well known in Europe, including familiar and established brands such as Bewator and Cotag in access control and Alarmcom and Europlex in the intrusion alarm sector. But who is Vanderbilt Industries? It's a fairly new U.S. company created around the acquisition in 2012 of the Schlage Security Management Systems (SMS) access control product line from Ingersoll Rand. The Siemens acquisition makes them instantly a global player. The move expands the global reach of Vanderbilt’s parent company, ACRE Ltd., and greatly enhances its technology capabilities and product portfolio.
2014 began with news that HD surveillance company Avigilon Corp. had agreed to buy video analytics company VideoIQ for cash consideration of $32 million. Avigilon moved quickly to incorporate VideoIQ's technology into its product line, highlighting video analytics (including the Rialto analytics appliances) along with other technologies at ISC West, IFSEC and trade shows throughout the year. Avigilon is positioning its "adaptive" analytics as a way to simplify total system operation, delivering only the information an end user needs rather than a flood of video images.
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4. HID Global Acquires Lumidigm
HID Global is an undisputed worldwide leader in secure identity solutions, so it was big news when HID acquired a biometrics company in February. More accustomed to interfacing with biometrics technologies than owning them, HID’s acquisition of Lumidigm reflects a high level of confidence in the company’s multispectral imaging technology, which uses multiple light spectrums and advanced polarisation techniques to extract unique fingerprint characteristics from both the surface and subsurface of the skin. The system can authenticate identities with a high degree of certainty (and even in non-ideal environments where fingers can get dirty or greasy.)
Vicon Industries and IQinVision announced a merger agreement in the spring to create a global provider of integrated solutions to the video security market. Vicon has long been known for designing and producing (mostly proprietary) video security and surveillance systems. IQinVision designs and produces high performance HD megapixel IP cameras. There are high hopes for the combined company, including continuing a camera line branded IQinVision and transitioning to an open systems approach with an emphasis on extracting business information from video streams.
It was a milestone for Anixter International, the largest acquisition in the global distributor’s 57-year history. When Anixter bought Tri-Ed for $420 million, the acquiring company emphasized the opportunity to accelerate implementation of IP video and access control by the new Tri-Ed customer base, previously more focused on analog. Tri-Ed, independent distributor of security and low-voltage technology products, sells 110,000 different products to 2,000 active dealers and integrators through 61 branches and two technical sales centers located throughout North America. Anixter is a global distributor of communications and security products, electrical and electronic wire and cable, fasteners and other small components.
7. Google Acquires Nest Labs
It makes headlines when Google does anything, and Google’s entry into the home systems market is no different. Therefore, everyone noticed when Google acquired Nest Labs, a designer and manufacturer of sensor-driven, Wi-Fi-enabled, self-learning, programmable thermostats and smoke detectors. Many observers saw the $3.2 billion transaction as providing a critical foothold into the home systems market. Announced in January and closed the following month, the acquisition set the stage for another acquisition that would serve as further evidence of Google’s intent to be a dominant player in the home systems market ...
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| The big deals of 2014 included some of the largest names in the industry |
Google-owned Nest Labs, Inc announced that it had entered into an agreement to buy Dropcam for $555 million in cash, subject to adjustments. DropCam provides do-it-yourself IP video cameras for the home environment – and another foothold for Google.
9. Kaba Holding Acquires Keyscan
Emblematic of the continuing consolidation in the access control market was acquisition of Keyscan Inc., a Canadian provider of networked access control solutions, by Kaba Holding AG, based in Switzerland. The Keyscan brand presence will be maintained, operating as a separate division of Kaba’s ADS Americas Group.
10. Hanhwa To Buy Largest Interest in Samsung Techwin
When Samsung sells its interest in Samsung Techwin, it’s bound to be news, even as the company’s management insists everything is business as usual. It was just a stock transaction (they say), and Samsung Techwin (which was always separate from the larger Samsung Electronics) will continue on its successful course in the video surveillance market. Korean conglomerate Hanwha Holdings announced in late November its 32.4 percent ownership in the video surveillance company (as part of a larger sale of Samsung Techwin’s defense and chemical affiliates). What about the Samsung name? Management assures the market the valuable and well-known brand will remain intact.
See the full coverage of 2014/2015 Review and Forecast articles here
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