Tyco announced yesterday that it has agreed to buy Exacq Technologies, a developer of open architecture video management systems, for $150 million in cash. The purchase would undoubtedly boost Tyco’s position in the IP video surveillance market.
In 2010, Exacq ranked 173rd on Inc.’s list of fastest-growing US companies. By 2012, it had fallen to 826th on that list, but its growth has been significant, to say the least. Exacq’s revenue grew a massive 184 percent from 2010 to 2012 to reach almost $55 million. Tyco expects that figure to climb to $75 million in 2014. If Exacq were to continue growing at its current rate, the Indiana company’s revenue could exceed the purchase price by the end of 2014.
Mike Ryan, president of Tyco Security Products, said in a press release announcing the deal:
The addition of Exacq to our video portfolio expands our best-in-class video solutions. The quality of Exacq’s products coupled with ease of use and ease of installation help us address the needs of a very different type of video user than we do with our current portfolio. Meeting the varied requirements of the diverse video customer base provides us with a unique position in the security industry, and increases Tyco Security Products’ leadership position in the video security business.
Exacq’s VMS offerings, including exacqVision, have been extremely well received by the industry as a whole, and this acquisition would immediately give Tyco a strong foothold in the desktop and mobile VMS market.
Reaction to the deal has been mixed. One US integrator tweeted, “With Tyco acquiring Exacq this week how long before their good tech support goes away, taking bets.” However, sources suggest that Exacq would be afforded a large degree of autonomy and would be allowed to continue growing organically, as it has since its founding in 2002.
This deal is relatively small beer for Tyco, whose annual revenue exceeds $10 billion. In 2012 alone, it added nearly $300 million of annualized revenue to its books through acquisitions. In its 2012 annual report, CEO George R. Oliver said that acquisitions would be “aligned with our organic growth initiatives focused on technology, product expansion and services.” The acquisitions Tyco made in 2012 offered “a good example of the type and size that we intend to pursue.”
Completing the spinoff of its residential fire and security business last year allows Tyco to focus more clearly on expanding its commercial fire and security businesses. Last year, it generated $5.3 billion of its global revenue in North America and $2.8 billion in Europe, the Middle East, and Africa.
What do you think? Is this deal good news for the industry? Is it a big deal? Or will it mean little change in the way Exacq works?
Free Download: The Video Surveillance Report 2023
Discover the latest developments in the rapidly-evolving video surveillance sector by downloading the 2023 Video Surveillance Report. Over 500 responses to our survey, which come from integrators to consultants and heads of security, inform our analysis of the latest trends including AI, the state of the video surveillance market, uptake of the cloud, and the wider economic and geopolitical events impacting the sector!
Download for FREE to discover top industry insight around the latest innovations in video surveillance systems.
