Physical Security Merger & Acquisition Activity to Grow in 2010.
02/11/2010

UK based research firm Memoori, have released a new report that predicts 50% of the companies in the security products industry lack the economic size to remain viable beyond the short term, and for many, acquisition will be the only alternative to dissolution. The current wave of consolidation among security equipment manufacturers will continue, driven largely by the sector's fragmentation.

Online PR News – 11-February-2010 – – UK based research firm Memoori, have released a new Report that predicts 50% of the companies in the security products industry lack the economic size to remain viable beyond the short term, and for many, acquisition will be the only alternative to dissolution. The current wave of consolidation among security equipment manufacturers will continue, driven largely by the sector's fragmentation.

The report focuses on how global companies with extensive building automation and fire protection businesses will influence the security industry's restructuring over the next few years as they face a surging, yet scattered group of IP video security vendors on one side and an opportunistic IT sector on the other. Video stands to be a wild card because it is among the most fragmented of the industry sub-segments, yet the sector is attractive because users want to give surveillance systems a greater strategic role in security. Meanwhile, access control systems, another fragmented segment, are becoming more tightly entwined with IT-based identity management.

"There will be marked growth through mergers and acquisitions over the next four to five years," said Allan McHale, director at memoori and author of the report, Survey of the Security Business 2009 - Shape, Structure & Consolidation. "There will be growth in mergers and acquisitions despite lack of money to finance them," he said, adding that many deals may be stock transactions. "And it will take place in a climate that's down-turning in some market sectors," McHale said. "Exit prices will fall."

The report assesses the shape and state of the security business in 2009 and the part that finance, entrepreneurship, technological and commercial trends will play in bringing about consolidation in 2010 and beyond.

It brings together all the quantitative and qualitative information about the business so that a realistic appraisal can be made about its future. Hard numbers about size, structure, shape and growth of the market are detailed before assessing the case for consolidation through merger, acquisition and alliance.

The research shows there is a dearth of information about these basic factors, particularly market shape and growth. Whilst market size is relatively well covered, estimates can differ by an order of magnitude and often lack clear definition. This report aims to deliver this basic information and then analyses the major cornerstone of business strategy today; merger, acquisition and alliance. Based on detailed mergers and acquisitions data compiled over the last two years, it analyses valuation benchmarks and the part that finance, entrepreneurship, technological and commercial trends play in bringing about major consolidation and restructuring in the electronic security industry.

This report is available to Purchase now for only £99 and will be of interest to all those involved in managing and operating electronic security companies (or their advisors) around the world and in particular those wishing to acquire, merge, sell or find alliance partners.

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