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Articles on this Page
- 05/19/11--10:46: _Is a Securitas/Nisc...
- 09/22/11--12:51: _ASIS 2011: News and...
- 01/18/12--05:31: _Vance in Vegas; Fiv...
- 05/22/12--07:40: _'20 under 40' 2012 ...
- 09/12/12--09:49: _ASIS 2012, Pro 1 bu...
- 04/26/13--09:55: _Tyco Security Produ...
- 07/24/13--12:00: _Iris scanning enter...
- 10/08/14--08:22: _Five questions: And...
- 09/11/15--12:32: _Johnson Controls to...
- 01/25/16--07:21: _Johnson Controls to...
- 01/27/16--11:49: _Tyco closes Shopper...
- 03/16/16--09:07: _Megamergers: benefi...
- 05/27/16--08:59: _JCI and Tyco announ...
- 09/07/16--11:15: _Johnson Controls an...
- 02/22/17--11:53: _Johnson Controls pu...
- 08/15/17--13:46: _Post merger, Johnso...
- 05/19/11--10:46: Is a Securitas/Niscayah reunion imminent?
- 09/22/11--12:51: ASIS 2011: News and notes from the show floor
- 01/18/12--05:31: Vance in Vegas; Five Diamonds for Johnson Controls
- 05/22/12--07:40: '20 under 40' 2012 - Bijal Thakkar
- 09/12/12--09:49: ASIS 2012, Pro 1 buys again, mobility and the financial vertical
- 04/26/13--09:55: Tyco Security Products secures hospital
- 07/24/13--12:00: Iris scanning enters mainstream market
- 10/08/14--08:22: Five questions: Andre Greco
- 09/11/15--12:32: Johnson Controls to sell JCSS to Versar for $20m
- 01/25/16--07:21: Johnson Controls to merge with Tyco
- 01/27/16--11:49: Tyco closes ShopperTrak acquisition
- 03/16/16--09:07: Megamergers: benefit or pitfall?
- 05/27/16--08:59: JCI and Tyco announce post-merger executive line-up
- 09/07/16--11:15: Johnson Controls and Tyco merger final
- 02/22/17--11:53: Johnson Controls publishes cybersecurity 'call to action'
- 08/15/17--13:46: Post merger, Johnson Controls emerges even stronger
STOCKHOLM, Sweden—Is it strange that guarding giant Securitas, which divested itself of its systems integration business (Securitas Systems, now Niscayah) five years ago, this week made a bid to buy that very same business back?
It may be an unusual situation, but it’s a deal that makes a lot of business sense for both Securitas and Niscayah, Imperial Capital’s John Mack told Security Systems News. And it’s a deal that Mack predicted is likely to get done.
“You can see the rationale,” Mack said. “Niscayah, on its own, hasn’t achieved the higher valuation it had hoped for ... and it’s attractive now because the price is not that high.” And Securitas made the decision to divest Niscayah at a time “where they didn’t see the evolution of the market,” he added.
That evolution is the trend toward the combined offering of guard, monitoring and systems integration services. The trend is well illustrated by G4S, a huge guard company that bought up Adesta and other systems integrators and now offers combined guards, monitoring and systems integration services.
Securitas AB on Monday made a $907 million public offer for Niscayah Group AB. Published reports say the offer is one Securitas share for every 4.19 shares in Niscayah.
The Wall Street Journal reported that “the acquisition is expected to be accretive to earnings per share from 2013, and [Securitas] estimates that the acquisition will create cost synergies of approximately SEK200 million annually. Securitas also said it expects restructuring costs to amount to SEK250 million in 2011 and 2012.”
Niscayah shares rose 29 percent, just above bid level, and Securitas shares were down 4.3 percent on Monday after the announcement.
According to several reports, including one in the Wall Street Journal, Securitas CEO Alf Goransson said during a Monday press conference that divesting Niscayah was a mistake.
In a May 4 statement, Goransson said: “We continue to pursue our strategy of specialization and segmentation, strengthening our capabilities in technology and added value tools and services, and to selectively make acquisitions in mature and new markets with the target to be present in approximately 60 countries within three years.”
He also acknowledged, in that statement, that contract losses “have been exceptionally high in the first quarter and are consequently causing a negative impact on the operating margin. Actions are taken to improve the situation, short term as well as in longer term.”
Niscayah announced on Monday that it has appointed an independent committee, consisting of board members Tomas Franzén, Eva Lindqvist and Håkan Kirstein, to evaluate the offer and make a fairness decision by July 4.
Securitas has said that Niscayah’s largest shareholders—Latour, SakI and MSAB—support the offer, according to published reports. The deal would need shareholder approval.
Should the deal go down, what would this mean for Niscayah’s North American operations? Mack said that he “wouldn’t be surprised” if part of the strategy is to invest significantly in growing Niscayah’s operations in North America.
“Niscayah has wanted to create a bigger position for itself in the North American market for years. It’s made small regional acquisitions but hasn’t stepped up to do something of a bigger size,” he said. “I wouldn’t be surprised if part of Securitas’ vision is to make a more aggressive move to grow the North American part of the business.”
ORLANDO, Fla.—There was plenty of news being made at ASIS 2011, which took place at the Orange County Convention Center Sept. 19-21. Below are some editor round-ups from ventured out onto the show floor to collect news and other goings-on.
Here’s Martha’s round-up:
The ASIS news started rolling in well before the show floor opened with the news released around 7 a.m. yesterday that Tyco International plans to split into three independent, publicly traded companies.
Over at the BRS Labs booth, John Frazzini, president of BRS Labs, during a morning press conference pronounced: “2011 is the year that video analytics died.” He cited the disappearance or winding down of several well-known video analytics companies and the paucity of video analytics companies on the show floor. Video analytics were “the past,” he said. The future is with behavioral analytics, which BRS Labs provides, he continued. This system “observes what happens in the scene, learns the behavioral patterns that occur over time, and alerts on abnormal activities.” Frazzini noted that behavioral analytics, specifically, are beginning to be spec’ed in some of the largest transit and airport projects.
On the show floor, surveillance system provider VideoIQ begged to differ with Frazzini. New CEO Ed Bednarcik and VP of marketing Mark Gally talked about the company’s partnership with thermal camera company FLIR. “Video analytics are ready for the mainstream,” Gally said. “They’re accurate, they’re easy to install and today they go way beyond alarm generation to power a whole system.” Gally explained that it’s the analytics that allow the surveillance system to “intelligently stream video and optimize storage.”
At March Networks, CEO Peter Strom and CMO Net Payne talked about how their new product introductions (an enterprise DVR, a 5 megapixel and a 3 megapixel camera, as well as new SearchLight applications such as skimming-detection features) are optimized for March’s focus verticals: banking and retail.
Strom noted that March Networks has grown from a $6 million to a $100 million company over the course of eight years ... and counts the top 50 banks in the world among its global customers with many banking and retail customers standardizing on March Networks globally. Payne said the company is becoming more “channel centric” and said the new products announced at the show are easier to use, install and are reliable, “so you don’t have to roll a truck regularly.”
At the giant Stanley Security booth, CEO Tony Byerly was eager to show off the company’s new eVideo Cloud storage solution, which is based on the Axis/Iomega AVHS systems that was announced at ISC West this year. Byerly called the product a game changer for the installer. “It’s 25 percent cheaper than a DVR,” he said. “The cost, the fact that it’s simple and fast to install and the online capabilities—we think this will transform video solutions.”
Byerly was also eager to show off new mapping features of the company’s well-known e-services. “This basically brings all the web services together on Google Maps. There’s a map view and a list view,” he said, which makes it much easier for a security director to get a handle on what’s happening at remote locations. Similarly, Stanley’s “einform” service now allows Stanley to send its customers real time updates when a serviced call is scheduled to arrive. It shows the GPS location of the truck, arrival time and a photo of the technician and details of the service request.” Byerly said the company will extend this service beyond installation to sales and repair calls as well.
Two years after the acquisition of GE Security was announced by UTC Fire & Security consolidation and integration efforts continue. Luis Orbegoso, president of Lenel, announced that the company will be offering a migration path for its large installed base of Picture Perfect customers to FacilityCommander and OnGuard. He emphasized that the decision to migrate is designed to protect the investments made by its large installed base of Picture Perfect customers. “The easy way would have been to tell customers they have to rip and replace, but this is a true migration,” Orbegoso said. Consolidating the platform will allow Lenel to combine the best of each offering and allow Lenel to “spend our time and effort on new innovations,” he said.
Expect to see more collaboration between Lenel and OnGuard, said Bob Hoskins VP and GM of Interlogix. He noted that the Sept. 30 episode of the television show “Designing Spaces” will feature a UTC Fire & Security-designed intelligent home—his. In the future, Orbegoso said he expects Lenel to “be the brain and the central nervous systems behind the intelligent building.”
At Johnson Controls, Andre Greco talked about the company’s BEST (Build Effective Sales Training) program that it’s currently running for recent college grads. It has been six years since the Fire and Security business graduated a BEST class. JC interviewed 1,000 (mostly engineering) students from across the nation and chose 16 to participate in the program, which runs from June to November. The intensive training program will result in 16 new “branch security solutions sales people for JC.”
“We’re going to transform our go-to-market strategy as it relates to security, from a transaction and product-based sale to a consultative sale,” Greco said. The BEST graduates “will be agents of change for Fire and Security,” he said.
Ed Melzer, Niscayah director of cloud hosting programs, stopped by the Security Systems News booth to record a video interview about new features of Niscayah’s hosted video solution, which like Stanley, is based on the Axis/Omega AVHS service announced at ISC West.
In a final booth visit of the day, identity management provider Quantum Secure’s Laurie Aaron, Ajay Jain, and Dan Yetso talked about the company’s focus in the next year on four key verticals; government, aviation, energy and health care. With regulatory compliance issue a concern for many of these end users, (CFATS and NERC-CIP to name two) “it makes us a very good value proposition,” Aaron said. The company, which received only one round of VC funding and has been doubling in size annually currently has 100 employees and is profitable, Jain said.
Meltzer spoke at a press conference about Niscayah’s hosted video offering. Later in the day, he also spoke to ssnTVnews about the service, which has some new features and which the company is starting a dealer program with. Here’s a link to the video.
Mega-megapixel camera (and HDVMS) company Avigilon introduced a new 29-megapixel camera at the show, which it will begin shipping the last week of October. Why 29? Avigilon’s new director of marketing and communications Keith Maret said they went for 29, because 20 was too close—performance-wise—to 16. And why mega-megapixel systems? ” High quality images give the best evidence ... and [Avigilon’s] high definitions stream management minimizes storage requirements.” The Canadian company has also filed a preliminary prospectus for an IPO, something the company won’t officially talk about, but which company president Alexander Fernandes mentioned later that night at a customer event at the Icebar, according to attendees.
A brief stop by at Brivo included a meeting with Maria Buenavista. The folks at Brivo were talking about a lot of different projects including one where Brivo’s cloud-based access control was installed at the Iowa Cubs ballpark in Des Moines. The system manages the comings and goings of more than 100 employees, which includes 12 groups who have access to different parts of the park during different days and times. It also includes alerts and reporting functions. But we were talking about Brivo CEO Steve Van Till’s presentation that he’ll be making at TechSec2012.
At lunch, I attended a media briefing with ADT Commercial’s John Kenning and ADT’s chief technology officer Jay Hauhn. Of course I wanted to talk about Tyco’s plan to split into three independent, publicly traded companies. Kenning talked a little bit about the deal. He noted that ADT split its resi and commercial business in May of 2010."The difference between residential security today and what we [at ADT Commerical] do are vastly different in terms of sales, implementation [and service]. This is taking it one step further and separating into different companies," he said.
ADT residential will continue to be headed by John Koch. Tyco Fire and Security will be headed by George Oliver, who has been with Tyco since 2002. Kenning's commerical business, Sensormatic and Tyco Security Products will report to Oliver. The residential business will keep the ADT brand, but the commercial fire and security business will lose that brand.
What Kenning and Hauhn really wanted to talk about is their new hosted video solution for enterprise and small business customers. Like the Stanley/Niscayah solution, it’s based on the AVHS systems announcedby Axis Communications at ISC West this year. Kenning and Hauhn laud the service as convenient, not requiring IT support, cost effective, can help with compliance and liability issues, and can be easily scaled.
They also wanted to talk about ADT’s new Pulse for commercial products. This interactive service product, announced for the resi marketin the fall of 2010 is currently being tested and Kenning expects to roll the service out in Q1 2012. “It’s a tool that will help your run your business rather than just secure your business,” Kenning said.
Later, Imperial Capital's Jeff Kessler met me at the Security Systems News booth for a quick interview. I asked him about the Tyco split and he said that the separation wlll give the "commercial and industrial business a chance to have a closer and more symbiotic relationship with SimplexGrinnell (its fire business)." Better integrating fire, security and building control systems can "provide tremendous data, that can be understood and used by the client," he said. "That can result in much stickier large enterprise client, and hence, better margins."
Like Avigilon, Arecont Vision cameras go way past 11. At ASIS, Raul Calderon, Arecont SVP of marketing, discussed the company’s new 20-megapixel/180-degree H.264 cameras. Arecont says the camera is most cost-effective in applications where PTZ cameras or other multiple cameras might be used to cover a large are, and makes the claim that it can replace lots and lots of cameras. (It says up to 65.)
At the Samsung booth, Janet Fenner, Samsung group marketing manager said the company is emphasizing how nicely it’s playing with others, such as Exacq, OnSSI, Genetec, Milestone and Verint. “We’re very aggressive with partnerships when there’s a company that’s looking for a solution.” Samsung is also changing the way it’s going to market, partnering with “the big four [distributors] ADI, Anixter, Scan Source and Tri-Ed Northern,” Fenner said.
Back at the SSN/SDN booth, I had a chance to meet Steve Russell, founder of 3VR. Russell’s most recent venture is called Prism Skylabs. Security Systems News will have a video interview onsite within a week, but SDN’s Whit Richardson wrote up a story about Russell’s new company.
Next I met with new managing director of CapitalSource Will Schmidt, and we talked, among other things, about a recent deal $42.5 million deal CapitalSource did with a very interesting company, Electric Guard Dog.
Martha’s Day 3 report: The first meeting of the day was with BreifCam CEO Dror Irani, where he talked about “liberating the video” so that it’s really useful customers’ security department, marketing department and more. This was a demo to follow up on a story Whit and I both worked on.
Next I went to AlertEnterprise, where I met with Ruby Deol, SVP strategy and business development. AlertEnterprise is a provider of logical and physical security software that announced a partnership with Proximex at the show. It also just got $19 in new funding and HP non-executive chairman of the board, Ray Lane, joined its board. They’re doing some interesting thingsat airports in particular that I’ll be reporting more on.
Kevin McCAughey of Schnieder was next. We talked about converged building management systems and their Continuum product. I also got a look at their new Sarix SureVision camera that self-adjusts in different lighting and weather conditions.
After a walk around the show floor, I met with Geri Castaldo, CEO of Codebench, a provider of middleware for access control systems. We talked about the PIV-I card moving beyond the government and into the commercial market. “It has the potential to be much bigger than the government market,” she said. There are problems with that happening, she said, because “not all PACS can accommodate PIV-I cards, and they need a workaround. She said Codebench has been contacted by companies in the financial sector (but not other sectors yet) about helping their systems accommodate a PIV-I card.
My last meeting of the show was with Siemen’s Rob Hile, new senior director of and Enterprise Solutions and Services, one of two segment heads who will oversee Seimen’s new converged fire and security business unit.
Here’s Dan’s round up:
It seemed like everyone was talking about the age of managed services. Integrators are no longer simply accepting them, but are beginning to expect them as well. According to some of the companies that SSN and SDN met with, the advent, proliferation and advancement of wireless technology has pushed the industry to a tipping point.
Video alarm verification provider, OzVision’s global director marketing Matthew Riccoboni said smart phones have trained end users to expect more.
"Smartphones have changed the way we interact with data. It's no longer sufficient to say, 'I'll look it up later.' Smartphones have created an immediate need, an immediate thirst for data. So what we're doing is making services like video available that way," Riccoboni said. "And it can be for a lot of different things: an audit trail, for liability issues in the healthcare vertical … The channel partners, the integrators are really thinking of where this can be effective … For example, with quick-serve restaurants, integrators can offer access to video that shows a manager if people are consistently leaving because of long wait times. That's business intelligence that tells the manager they might want to bring on more staff to better serve their customers."
It's all about choice and not getting stuck in the past, according to Telular vice president of marketing and business development Shawn Welsh.
"Our focus has been on raising RMR. Cellular is now a trusted pathway, so now how do you leverage it to make more money?" Welsh asked. "One way is through offering interactive services, which we developed with the TG-1 express that works with older panels as well as new panels. You can offer an iPhone app to a panel from the '80s."
Diebold director of security solutions Jacky Grimm pointed out that managed services allowed integrators a way to offer a lower price point and a lower learning curve for getting in on the value managed services can offer.
"Technology is changing so fast. It's difficult for end users to have the money there to update. What we're doing is packaging it in to leverage payment over time," to include things like training, oversight and hardware and software updates. "So you pay a flat fee up front, but the technology keeps pace with the world,” Grimm said.
I began the morning by sitting down with Lorrie Navarro, senior security manager at SAS Institute and co-chair of ASIS' Women in Security Group. She told me about some of the new initiatives the Women in Security Group, launched in 2009, has recently undertaken, such as its mentoring program that links young, up-and-coming security professionals with seasoned vets.
I also had the opportunity to sit down with Todd Milne, senior manager of security operations for University Health Network in Toronto, and David Pollard, superintendent of operations for Tallahassee Regional Airport, to talk about recent security system deployments undertaken at their respective organizations. Look for the video interviews to be posted on the website.
Throughout the day, I paid attention to the news releases arriving in my inbox. PlaSec, which offers a cloud-based physical access control solution, announced yesterday that it has rebranded itself as RedCloud Security.
Johnson Controls announced a deal worth $29 million to design and install integrated security systems at 12 major soccer stadiums in Brazil, including two that will host main matches for the 2014 FIFA Soccer World Cup. The deployment will include access control, as well as the installation of 1,700 surveillance cameras, video servers and vide analytics software.
At a press conference at Assa Abloy’s tent, Martin Huddart, Assa Abloy’s VP of electronic access control, talked about some of the 50 new products Assa Abloy and its 40 brands were releasing at the show.
Later, at an event put on by HID Global, a subsidiary of Assa Abloy, Denis Hebert discussed the future of electronic access control and an HID near field communcation pilot at Arizona State University that enabled student’s smartphones to carry their identity credentials and gain access to residential dorms on campus. Laura Ploughe, director of business applications and fiscal control at ASU, called the technology and pilot “a dream come true.”
At SightLogix’s booth, John Romanowich, the company’s president and CEO, introduced the company’s new Clear24 cameras and released the news that the company had landed the contract to provide its thermal imaging cameras to the World Trade Center site’s perimeter security. Considering Romanowich launched the company a few years after doing a security survey of Ground Zero, he says the new contract completes the circle.
Day 2 at ASIS 2011: I began the day with a bang, interviewing Lou Barani, security director for the World Trade Center. We discussed what his day was like on the 10th anniversary of 9/11. With all eyes on the site and the president's visit, not to mention the memories, was the day stressful? "It was anticlimactic," Barani said, adding that he was confident they had done everything they could to prepare. We agreed that in the security industry, anticlimactic is a good result.
I then swung by the Honeywell pavilion to learn about its upgrades to its Pro-Watch security management system, including its integration with the Honeywell Software Development Kit, which enables increased interoperability between Honeywell technologies and products from third-party manufacturers.
Then it was back to the Security Director News booth to interview Darin Crofts, loss prevention manager for special projects for Woolworths, the largest retailer in Australia with $53 billion in sales and around 3,000 retail locations. He told me about the unique challenges of operating a loss prevention program across such a wide-open country, and the decade-long project to upgrade its legacy video surveillance system with new IP-based cameras.
At the Axis Communications pavilion, I had the pleasure of meeting Martin Gren, the inventor of the IP camera and the company's founder, as well as Fredrik Nilsson, Axis' general manager for the Americas. Being new to the industry, I was interested to learn that only 25 percent of new camera deployments are IP cameras and that 98 percent of the millions of surveillance cameras out there are still analog. Gren said that when he released the first IP camera in 1996, people laughed. However, today's IP cameras are 600 times more powerful than that first camera and it is now accepted that network-based cameras are the future.
Continuing the video theme, I then visited Zvika Ashani, CTO of AgentVI, the Israeli-based video analytics company. Ashani walked me through the company's video analytics program, highlighting its three main applications: real-time event detection, forensic video search, and business intelligence. The day before, John Frazzini, the president of BRS Labs, declared "2011 is the year that video analytics died," a declaration Ashani scoffed at. "The past couple years, we've seen 100 percent growth year over year," Ashani said.
At OnSSI, I got a look at the Ocularis software, which the company had just announced was deployed at the Orange County Convention Center, the site of the ASIS 2011 show.
I then rushed back to SDN's both for the third video interview of the day, this one with Peter Miller, CSO for Orange County, which has hundreds of public buildings—courthouses, public safety buildings, etc.—with close to 3,000 video cameras and 2,000 access controlled doors. Miller, who came from the IT-side of the business, has a staff of 20. His department acts as its own integrator, saving the county government thousands of dollars.
At Genetec, I learned got a chance to see the “world's smallest HD license-plate recognition camera,” designed to attach to the top of a police car or other vehicle. These cameras have an accuracy rate above 95 percent at 200 miles-per-hour, according to Michel Chalouhi, Genetec's director of product management.
I then visited the largest security company in the world, G4S, which employs 700,000 worldwide. In the United States, it is the second largest private employer behind WalMart. When Lew Pincus, G4S' senior director of marketing, joined the company two-and-one-half years ago, he said no one would think to hire a company known for security guards, which G4S was, to handle high-tech security needs. Those times are gone, Pincus said, explaining that, through a series of acquisitions, G4S now "provides pretty much everything but cybersecurity."
Over at Diebold, Martha Entwistle and I heard from Kevin Engelhardt, its VP and general manager of enterprise security solutions, about the company's move to a more service-based model that would help the customer control costs and help Diebold develop some RMR.
That evening, I was invited by Siemens to Epcot, where the company has sponsored the Spaceship Earth ride inside the iconic Epcot sphere since 2005. At the event, Siemens announced it was merging its fire and security businesses.
Day 3 at ASIS 2011: Several informational meetings started off the final day of ASIS: Ingersoll Rand, where I got a demo of the near field communication access control technology that it plans to began piloting soon; IQinVision; and VidSys, which released its mobile application for its PSIM system at the show.
At BRS Labs, I sat down with Ray Davis, its founder and CEO, to discuss the company's approach to video analytics. Traditionally, analytics software has been rules-based, but BRS Labs took a different approach, developing software that was reason-based, Davis told me. "Rules are bad," Davis said. "Every rule you add exponentially increases the number of alarms." What BRS' software does is translate a camera's images into a language that an artificial neural network can read, allowing the computer to "learn" behavior, according to Davis. He told me the company, which sold its first products in November 2010, will reach $10 million in sales its first year and he expects to reach roughly $70 million by the end of 2012.
After listening to DHS Secretary Janet Napolitano give a keynote address at a luncheon, I left before the food was actually served to meet a few of the men behind Security-Net, a group of 19 independent integrators that team together to bring strength in numbers.
At Lumidigm, I met with Bill Spence, its VP of transaction services. The biometric technology company has some big clients, including a major national theme park that uses the company's fingerprint biometric readers to scan 38 million fingertips a year, Spence said.
A few demos wrapped up my first ASIS trip. At BriefCam, I got a demo of its video synopsis software, which condenses hours of video footage into a minutes-long clip that overlays all the action and events the camera picked up in that time. I then got a demo of Brivo's cloud-based access control solution, which also has integrated web-hosted video, before heading to the airport for a flight back to Maine.
Highlights from a press conference from Dan:
Wireless lock and access control suppliers Salto and Sielox announced a technology partnership the two companies say will allow integrators to offer more affordable access control across an enterprise, regardless of whether doors are traditional, hardwired doors/locks or newer wireless locks. At a joint press conference Sept. 20, Salto SVP Mike Mahon and Sielox president and CEO Karen Evans presented the partnership which pairs Salto's electronic locks with Sielox's Pinnacle access control system and 1700 controller.
"With this integration, we have wireless locks that you can deploy anywhere," Mahon said at the press conference. "Now you can extend access control anywhere in your facility, from a padlock all the way up to a full locking system."
Evans said the partnership's most powerful element was its ability to lower the price of extending access control enterprise-wide.
The last time SSN caught up with Mary Jo Vance, in April 2011, she was contemplating taking the summer off to “ride cross-country on my Harley” after leaving CenterPoint Technologies. Vance, better known in the industry as MJ, recently let CSAA members know she is “alive and very well in Vegas” after landing a new gig: manager of 1 Time Inc.’s new central station in Henderson, Nev.MJ says she’ll have more details soon about her latest endeavor, but the company is still building its website and sorting through “new ideas and new adventures. … Right now we can’t give you the full picture.”
MJ served as vice president of operations and business development for CenterPoint for three years before what she described as an amicable departure last spring. A well-known and respected leader in the industry, she received the CSAA’s Manager of the Year award in 2007 and the Presidential Award from the Fire Marshals’ Association of Missouri in 2010.
Five Diamonds for Johnson: Congratulations to Johnson Controls’ central station in Milwaukee, which recently joined an elite group by earning Five Diamond certification from the CSAA. The station is among 132 of roughly 2,700 centrals nationwide to have received the distinction, according to the CSAA’s website.
To qualify, all of Johnson Controls’ central operators had to pass a CSAA online training course, proving their proficiency in alarm verification, PSAP communications, knowledge of electronic communications equipment and the standards of Underwriters Laboratories, Factory Mutual, the National Fire Protection Association and other organizations.
“This prestigious certification reflects the dedication and determination our central station operators bring to the job to help protect the many corporate customers we monitor every day in the U.S.,” Paul Pisarski, manager of field support and remote operations for the company’s Building Efficiency unit, said in a prepared statement.
Calling all duffers: Looking to get into the swing at ISC West before everyone hits the show floor? Then this one’s for you: the ninth annual Alarm Research and Educational Foundation (AIREF) golf tournament, scheduled for Tuesday, March 27 at the Revere Golf Club in Las Vegas.
The Electronic Security Association created the nonprofit AIREF in 1977 as a way to help raise money for industry research. Funding for the foundation is derived almost solely from the golf tournament, which promises players “a casual golf outing” with other industry professionals while supporting AIREF in the process.
Bijal Thakkar, 38
Director, global product management
How did you get into the security industry?
I had come to the United States (from India) to do my MBA and after I finished, Ademco Pittway was looking for some talent that did not necessarily come from the industry but had the right analytical and thinking skills. They were really trying to infuse their marketing department with some graduates who had a new sense of energy and really none of the preconceived notions of what the industry was all about. I joined the industry (as assistant product manager) in the late ’90s as part of Ademco Pittway, which later got acquired by Honeywell. After about 10 years, for personal reasons, I moved to Austin (Texas) … and I worked in a different industry for about a year, but I missed the security industry. Johnson Controls was looking more for product management talent … and that’s how I ended up there in 2010.
What can be done to attract more young people to the industry?
I remember when I interviewed with Gordon Hope, now with Honeywell, but at that time he was vice president of marketing (at Ademco Pittway). I had no marketing experience because I was originally in corporate finance and chemistry, and I certainly had no security experience … and if he had not seen the potential in me from a security and marketing standpoint, I would not be here today. … So, it’s up to the leaders of this industry to really look for that young talent, recognize it, mentor it and nurture it so that there are leaders of tomorrow.
Who in the industry has helped you most in your security career?
Gordon Hope would be one of them. … Gordon had a lot of influence on the development of my skill set.
It’s been a busy two days for Amy Canfield (the new lead editor for our sister publication Security Director News) and I here in Philly at the ASIS show.
Since Sept. 10, the first day of ASIS, was Amy’s fifth day on the job, she accompanied me to most of my appointments that day. She did have a chance to speak to a group of end users at the Honeywell booth. Here’s her update on that and she was flying solo on Day 2--check out her blog for highlights of her day, including a tour of the security operation of the Philadelphia Convention Center with integrator Schneider Electric.
Here are some highlights from my conversations on the show floor on Day 1 and Day 2. Check back tomorrow for Day 3.
At the Diebold booth I met with Tony Byerly, who’d just completed his first 90 days as head of security at Diebold, along with Diebold IT chief Jeremy Brecher and Felix Gonzalez, who earlier this summer left Stanley to join Byerly’s senior staff as the newly appointed VP for strategic initiatives and business development in electronic.security.
Diebold was the first of several integrators I spoke to who said that one focus for them will be the financial services vertical. It’s not a surprise for Diebold, who's parent company is the largest ATM provider.
Byerly touted Diebold’s long history, the company’s reputation for steady, high quality service and technology know-how as advantages in the marketplace. He also noted the shifting competitive landscape and said Diebold stands out for a variety of reasons including the fact that “we’re a strategic in the space—we’re not backed by private equity.” He called Diebold the “nation’s only pure-play integrator,” pointing out that “we don’t have an adjacent manufacturing arm.”
Brecher talked about being “in the value position” with service and technology. “We invest time and resources to create solutions instead of packaging solutions,” he said. Diebold works to leverage a customer’s existing infrastructure, and customers have a “single method to connect to Diebold … a single customer portal … the entire web experience is easy to manage.”
Protection 1 had some big news. Click here to see the story about a big acquisition Pro 1 made. It’s a systems integrator with staff that's experienced and certified to work on networks. With the new staff/capabilities, Jamie Haenggi told me, Pro 1 will be taking on jobs it would have walked away from in the past.
Stanley announced that John Nemerofsky is the new VP of Global Solutions, and that there's a new phalanx of vertical market leaders. There’s other news as well. Stanley is bringing together three business units: the CSS team, the Mechanical Solutions team, and the Security and Automatic Door team.
The teams would work together in the past, but it “would happen more through accident,” Nemerovsky told me. Now, there’s a “process where we’ll work together to pull together the best possible solution for the client.”
And there are specific solutions for each vertical market. This infrastructure will be appreciated by global accounts customers who “are looking for consistency in deliverables … the same deliverables, billing, systems they have in Chile [for example], that they have in New York City, Barcelona, Tokyo and Paris.”
Here’s the list of vertical market leaders: Paul Retzbach – Commercial Leader, Government; Chris Hobbs– Commercial Leader, Retail; Tom Benson – Commercial Leader, Banking; Paul Baratta–Commercial Leader, Healthcare; Rebecca Durham–Commercial Leader, K-12 Education; Eric Rittenhouse–Commercial Leader, Higher Education; Jerry Walker–Global Strategic Account and SSS Solutions; Eddie Meltzer–Global Strategic Accounts and SSS Solutions; Bob Stockwell–Technology Leader; Lance Holloway–Technology Leader; Beth Tarnoff–Marketing Leader; Ryan Fritts–Vertical eServices Leader
Look for more on this story next week.
I also spoke with Renae Leary, senior director of global accounts for Tyco. Click here to read that story.
I spoke to Tammee Thompson at Johnson Controls, who told me that ASIS is the show where she and others "take a break from making the quarter" (but only briefly she emphasized) to check out technology. She had an army of employees out scouring the floor “looking for the latest and greatest to pull into our technology stack.” Specifically, JCI is looking for access control solutions, VMS, PSIM and ID management solutions.
I also had a chance to chat with Mike Snyder of Red Hawk. He said that the company is finishing up “moving the infrastructure [network and IT systems] out of UTC,” and officially began its rebranding as Red Hawk in the past couple of weeks.
Snyder also talked about focusing on the financial vertical market, saying that the next wave of retail banking will not be branch operations, but ATMs. He believes Red Hawk will have a leg up on the competition because his staff has deep experience in the financial sector, some originally coming from Mosler. The company also has a partnership with ATM provider NCR.
At this show, Axis Communications was showing many new products and solutions, many targeted toward the fewer-than-16 channel market. (Look for a story next week about a visit I made to Axis H.Q in Massachusetts a couple of weeks ago.) When I asked Fredrik Nilsson about all the talk I was hearing about the financial vertical, he noted that Axis had an ATM with four cameras in its booth. Nilsson said that banking is a conservative vertical that is finally making the leap from analog to IP. “Education was the first, then retail, and now it’s banking’s turn.”
He agreed with Snyder’s point that the new wave of retail banking is moving from the branch to ATMs. "When was the last time you went into a bank branch?," he asked. "I refinanced my house online."
Coincidentally, Axis is also in the process of hiring a business development specialist for the financial vertical, he said.
At the Avigilon press conference, the company introduced the new version of its software. Keith Maret said Avigilon took inspiration from Google, Apple and Facebook in the development of this software. The cool thing is that the software can respond to voice commands and body movements. COO Andrew Martz demoed this capability and it was like watching a command center staffer play squash on a Nintendo Wii. The command center screens zoomed and focused in response to voice commands and hand gestures. This feature is in the alpha phase. “We’re gauging the interest in it,” he said.
Maret summarized the features thus: crash-proof enterprise server management, where all servers are grouped together; a “collaborative mode” where more than one person can log into video feed and manipulate the video in real time; and intelligent virtual matrix that “allows you to turn video walls to life.”
At Honeywell, in addition to talking to the end user committee, I spoke with Scott Harkins about Honeywell’s emphasis on the “connected business," where the access, video and intrusion systems are tied into other systems such as: HR systems, radars [in super high-end port applications] POS for example. The emphasis of course, as we heard from nearly every manufacturer at the show, is on mobility. Honeywell’s newest ProWatch 4.0 access control has a new mobile offering that enables remote access from iPads, phones and other devices. It’s also integrated with wireless locks, something Harkins is very excited about, because it’s so much cheaper to install, maintain and manage.
The traffic on Day 1 was the lightest I’ve seen in a while at an ASIS show. It picked up considerably on Day 2, but it was still moderate traffic to my eye.
Why? Well, there’s the economy of course. Things may be looking up, but one manufacturer told me that people who’ve got money in the bank are keeping it there. They’re still cutting corners on travel—making this a one- or two-day show, rather than three.
I also heard that having the show in Philly meant that tri-staters could take the train in for Day 2 and 3.
And, I understand there may have been some football-related reasons that folks weren’t here on Monday.
I can think of about 80 things I’d rather do [including laundry] than watch football on a gorgeous fall day, but if football will help roll back the expectation that people should travel to work events on Sundays, count me in.
Go Pats. Woo.
WESTFORD, Mass.—Tyco Security Products announced this week that Yale-New Haven Hospital (YNHH), based in New Haven, Conn., has chosen an integrated security solution from the company’s Software House and American Dynamics brands, according to a Tyco statement.
The solution will secure YNHH’s 1,500-bed flagship teaching hospital and various other sites as part of its parent organization, Yale New Haven Health System.
By selecting Software House’s C-Cure 9000 security and event management system and American Dynamics’ VideoEdge network VMS, YNHH will be able to centralize the management of its security systems, both access and video, from the hospital’s 12 individual sites on the network.
“This new system not only provides critical information to our department so we can make timely, strategic decisions, but it also offers system intelligence to provide data to the rest of our organization,” said Marvin White, manager of Physical Security-Protective Services at YNHH, in the statement.
In collaboration with its integrator, Johnson Controls, YHNN’s access control migration plan includes updating the access control credentials for more than 12,000 workers in the network, impacting more than 1,000 doors and readers. When the transition is completed this spring, the hospital will have a system that will grow for years to come because of the scalability of Software House’s integrated system, the statement said.
ROCK HILL, S.C.— Iris scanning technology is typically used by the government, the military and in hospitals. However, as prices have started to come down, the market for the technology is expanding to also include mainstream users, ranging from universities to your local gym.
Lower prices have made iris scanning technology attractive to more types of enterprises, said Bryan Alexander, a sales representative for Cranbury, N.J.-based Iris ID Systems, a supplier of the technology.
“We now have a number of health clubs using it, for example, not from a high security standpoint but for convenience. It’s being used for safety deposit boxes and in different markets that we haven’t seen before,” Alexander said.
The public being more accepting of the technology also helps, he said.
Winthrop University, located here, is one example of a new mainstream user of iris scanning technology.
After the shooting tragedy at the Newtown, Conn., elementary school late last year that left 20 students and six staff members dead, Winthrop put a renewed focus on security. It found iris-scanning technology to be the answer it was looking for.
“It was kind of like what happened after Virginia Tech. It changes your emphasis,” said James Hammond, vice president for information technology at the university, which has about 6,600 students. That was especially so, he said, because so many of Newtown victims were young children.
Winthrop has on its campus an early childhood laboratory school, which enrolls about 70 children at a time. It serves as a preschool and a kindergarten. University students who are education majors work at the site as part of their program.
“We were looking at it, and we realized that the kids were always supervised by adults, but what happens when an adult, some unauthorized, comes to pick one of them up? The adult has to leave the children unattended,” Hammond said.
Winthrop looked at fingerprint biometrics access-control systems, but didn’t like the idea of “touching” that could spread germs, Hammond said. Access control cards, which Winthrop has used and still uses in many areas, can get lost or might be stolen, and if a loss or theft hasn’t been reported, the card will still work, he said.
He and his team decided on technology from Iris ID, which is a spinoff of LG Electronics. “If it was good enough for the military and U.S. government, it was good enough for us,” he said. “We knew immediately that it was the type of technology we were looking for. It was the tightest, most secure, practical and affordable system we came across. Access cards can be forged, irises can’t.”
Manufacturer Iris ID sells directly to its partners. The partners range from integrators to security solution providers and a few technical distributors. Some partners include Tyco, Lenel, ColorID, Johnson Controls and SimplexGrinnell. Partners work directly with end users on final system configuration and planning, Alexander said.
Winthrop University bought the product from a nearby distributor, Hammond said. Then he and the three other members of the university’s IT department chose to integrate it themselves. “We couldn’t find an integrator to do it in our time frame. And we didn’t want to spend an arm and a leg,” he said. With the in-house expertise, he said, “we pulled it together in a matter of weeks.”
Testing of the iris-scan system this summer has been great, he said. So far about 1,600 students have signed up, and he expects many more will follow suit this fall. “College-age students are very accepting of technology,” he said.
Final implementation will occur this month, and Hammond expects to have another building using the system before September. He envisions expanding the system throughout the campus to include the chemistry building, gym and pool facility and the dining room, all places that “would be really nice to have touch-free method of access.”
Andre Greco is the new VP of sales and marketing for Columbus, Ohio-based systems integrator Xentry Systems Integration. He’ll focus on driving strategic sales and marketing programs that enhance brand awareness and market share. He has more than 20 years of industry experience. Most recently, he was VP of sales and marketing, North America, for Johnson Controls and he has held top sales roles at Ingersoll Rand Security Technologies and Siemens Building Technologies.
Security Systems News caught up with Andre in July and asked him five questions:
Where did you grow up?
I was born and raised in Connecticut. I grew up in a town called Berlin. It was a small town with one high school and everybody knew everybody. I still live in Connecticut, in Enfield.
Now you’ll be working in the Midwest. What do you think about that part of the country?
The people are little bit more cordial than what we typically find up in the Northeast and the pace is a little slower, with a little more family orientation. So I’m really looking forward to that.
What are your hobbies and interests outside of work?
I play some golf, but most of my free time is reserved for the kids. I have four, whose ages range from 14 to 22, and it’s like having another full-time job.
Do you go to a lot of their sports events?
I did when the kids were growing up. I coached baseball and basketball and about five years ago I actually started a baseball league in Enfield for special needs children. My youngest has autism, so I’m very involved in that community, and saw a need for kids with special needs to have a very specific program where they could get out and do some exercise and have some fun and social interaction with other kids.
What’s a good book and movie you would recommend to others?
“What the CEO Wants You to Know.” It’s a good book for those who have an entrepreneurial spirit. From a movie perspective, I think my all-time favorite is “On Golden Pond.”
SPRINGFIELD, Va.—Johnson Controls (JCI), which has shed a number of businesses in recent months, on Sept. 4 signed an agreement to sell its specialized federal security integration business, called Johnson Controls Security Systems (JCSS), to Versar, a government-services business located here, for $20 million.
The deal is expected to close by Oct. 1, according to Michael McManus, Imperial Capital managing director. Imperial Capital advised JCI on the deal. JSCC has approximately 50 employees.
JCI has refined its business focus in the past 12-18 months, and this deal is part of that strategy, McManus said. “JCI has done a number of divestitures and one or two acquisitions to take them more deeply into the manufacturing and building controls.”
JCI still has a large security integration business that does about $300 million in business annually. “They still consider security integration to be core to them because its goes well with building controls, but JCSS was set off in its own silo at JCI,” McManus explained.
Based in Gaithersburg, Md., JCSS is CAS-compliant—a government designation that means it’s “set up really to do only government work and really only federal government work. The client it’s best known for is the FAA,” McManus said.
JCSS does access control, video and some perimeter work, “but it didn’t do HVAC, so it was considered non-core to the refined manufacturing and building-control focus of Johnson Controls,” McManus said.
Versar is a “better home” for JCSS, because it’s a “smaller company [than JCI] with extensive government contracting expertise. They should help grow JCSS,” he said.
Versar does “difficult projects in difficult places,” McManus said. And, JSCC “does security integration for clients like the FAA, which fall into the same category.”
In a prepared statement, Versar CEO Tony Otten called JCSS “a great strategic fit for Versar, extending our client base, and enabling us to offer additional products and services to our existing clients.” Otten said Versar want to use its “service capabilities to generate more work with our existing clients and to more effectively compete for new customers and projects.”
MILWAUKEE and CORK, Ireland—In a deal that brings strategic security capabilities and substantial tax benefits, Johnson Controls announced today that it will merge with Tyco. The deal was approved by the board of directors of both companies and is expected to close at the end of 2016.
Johnson Controls shareholders will own approximately 56 percent of the equity of the combined company and receive aggregate cash consideration of approximately $3.9 billion. Current Tyco shareholders will own approximately 44 percent of the equity of the combined company.
“I think the deal was motivated on both sides by dynamics of the market; both companies have had a lot of challenge growing,” Alper Cetingok, managing director of Raymond James, told Security Systems News.
Cetingok noted that Johnson Controls is divesting its automotive business, Adient, which had been underperforming. Security is a better fit for a conglomerate like Johnson Controls that is working to become a building-technology, building-automation giant, he said.
“Security is at the core of anything automation, whether it’s on the residential side or the commercial side. Strategically, security is a much stronger business to help Johnson Controls prosecute its building automation strategy,” he said.
In addition, Johnson Controls will benefit from the tax inversion. The combined company will be headquartered at Tyco’s current headquarters here in Cork, Ireland. The primary operational headquarters will be in Milwaukee.
The tax inversion “will save the company 20-plus percent on the corporate tax rate, which from an earnings-per-share standpoint is very significant,” Cetingok said.
Johnson Controls has an enterprise value of $14.6 billion; Tyco has an enterprise value of $29.07 billion. JCI's market capitalization is $13.9 billion and Tyco's is $22.3 billion.
The combined company will be renamed Johnson Controls. After closing, Alex Molinaroli will be the chairman and CEO of the combined company. George Oliver will serve as president and COO and serve as a director on the new board, with responsibility for the operating businesses and leading the integration.
After 18 months, Oliver will become CEO and Molinaroli will become executive chair for one year, after which Oliver will become chairman and CEO.
The board of directors of the combined company is expected to have 11 directors, six directors from Johnson Controls and five from Tyco.
In a prepared statement, Alex Molinaroli, Johnson Controls chairman and CEO, Johnson Controls said that "Tyco aligns with and enhances the Johnson Controls buildings platform and further positions all of our businesses for global growth." The deal will allow JCI to "further invest globally, develop new innovative solutions for customers and return capital to shareholders," he said.
In September, Johnson Controls sold JCSS, its security installation business focused on the federal government. JCI retained a large security integration business that does about $300 million in business annually. At that time, Michael McManus of Imperial Capital told SSN: “They still consider security integration to be core to them because its goes well with building controls, but JCSS was set off in its own silo at JCI."
Johnson Controls is a global diversified technology and industrial company with 130,000 employees. It does business in 150 countries. Its products, services and solutions include those designed to optimize energy and operational efficiencies of buildings; lead-acid automotive batteries and advanced batteries for hybrid and electric vehicles; and seating components and systems for automobiles.
Tyco is pure-play fire protection and security company. It has 3 million customers and 57,000 employees, 900 locations. It does business in 50 countries. Ten years ago, Tyco was a giant conglomerate, which had been assembled by former Tyco CEO, Dennis Koslowski, in the 1990s. It began spinning off non-core businesses in 2006. In 2011, it announced plans to split Tyco, ADT and its former Flow Control business into three separate.
Centerview Partners is serving as Johnson Controls' lead financial advisor. Barclays is serving as financial advisor for Johnson Controls. Wachtell, Lipton, Rosen & Katz and A&L Goodbody are acting as its legal advisors.
Lazard is serving as Tyco's lead financial advisor. Citi is providing the committed financing for the transaction and Goldman Sachs is serving as financial advisor for Tyco. Simpson Thacher & Bartlett and Arthur Cox are acting as its legal advisors.
CORK, Ireland—Tyco on Jan. 26 announced that it has completed the $175 million cash acquisition of ShopperTrak, a Chicago-based global provider of analytics for the retail industry.
Tyco announced its intention to acquire ShopperTrak, which currently generates $75 million in annual revenues, in December.
ShopperTrak's solutions include perimeter traffic counting, in-store consumer behavior analytics and industry benchmarking.
Tyco plans to combine ShopperTrak capabilities with its existing loss prevention, inventory intelligence and retail traffic analytics solutions, bringing “retailers a unique combination of insights that they can use to make more informed decisions to improve their revenue and profitability,” Tyco said in its announcement.
In a Jan. 25 conference call regarding the Johnson Controls/Tyco merger, both JCI CEO Alex Molinaroli and Tyco CEO George Oliver, spoke about the importance of providing data analytics to customers. Molinaroli noted in particular, “the insight [Tyco] provides customers in the retail space.” Oliver said the “real opportunity” for the combined company is “the Internet of Things and smart buildings.” Part of that is “utilizing data generated from our customers [that enables us to] give them information that will help them operate their facilities and understand their business.”
YARMOUTH, Maine—Industry consolidation will accelerate this year with two megamergers—the Tyco/JCI deal and the ADT/Protection 1 merger—expected to close by the end of 2016. Does this activity help or hurt the industry? Respondents to Security Systems News’ latest news poll who said massive consolidation is good just barely edged out those who said these megadeals hurt the industry. Meanwhile, another group of respondents said they have other things to worry about.
Several respondents said that smaller companies will have opportunities for growth while ADT and Protection 1 are focused on their merger. “For the short- to mid-term I think the mergers will help us because of the normal problems and disruptions that come with such mergers,” Tracy Hendrix, president and CEO of Femac Security Solutions, wrote.
Three-quarters of respondents identified themselves as an integrator or installer. Fifteen percent said they work in monitoring, and 11 percent said their company manufactures security equipment. (Percentages do not add up to 100 as a result of rounding.)
“In my experience, the consolidator has to put so much effort into the assimilation process and finding where and how to gain synergies, that their customer service suffers. Those unhappy customers will go somewhere and oftentimes, they go to a more traditional dealer specifically to get away from mega-alarm companies that have failed them from a customer service perspective,” another respondent wrote.
One manufacturer sees a benefit for his or her business, “As an OEM that owns a PSIM dashboard, … the turbulence created by M&A in the industry helps the more mature companies with sound partnerships and strategy; if Apollo doesn’t manage the ADT acquisition well, we all have a great chance of convincing the larger of the ADT end users to re-evaluate the security platform they use.”
Just over half of respondents said their business won’t see any change as a result of ADT’s latest deal, while 22 percent predicted that ADT will be a stronger competitor.
Twenty-seven percent of respondents, including Sentry Security Solutions’ president and CEO Nick McAmis, said that talented professionals will be looking for places to work as a result of consolidation. “This affords smaller players, such as ourselves, the opportunity to provide those folks with a new home,” McAmis said.
Consolidation on this scale is good, according 41 percent of respondents. “It is easy to compete against a conglomerate. I used to compete against two or three companies—now only one,” said one reader.
Companies will be able to increase their brand recognition according to McAmis. “A merger of this size is good for our industry. It eliminates one more large name in the marketplace and broadens the ability of our brand to reach consumers that don't want to be under the ADT banner.”
“I also think fewer big name competitors causes the consumer to shop ‘deeper’ and more local into the available service providers, so that's good as well,” Rob Driscoll, general manager, monitoring services at Koorsen Fire & Security, wrote in.
The ADT deal is bad for one-third of respondents. “These merges will make these companies financially driven,” said one respondent. “Monopolies always cause trouble,” said another reader.
End users suffer from deals like these, according to one respondent. “Consolidation is never good for the end user ... it create less competition.”
Twenty-six percent said they have other things to worry about. “The Johnson Controls merger is more dangerous [than ADT’s purchase and merger],” commented one reader.
Driscoll said each deal is different. “When ADT bought Brinks, that was not so good because Brinks had the best reputation for customer service and quality, so losing that (or at least diluting it) was not good for the industry. However, P1 is another excellent quality player, so I think this potentially has an upside for the industry.”
Everett Howard, owner and CEO at Howard Systems, shared a similar thought. “This will devalue the security market both in value and quality. We feel and have seen over the years that this type of merger causes the company to blanket the market with cheap installs. Cheap installs are low quality product and install. … This hurts small integrators in the beginning and if they can survive this burst, [they] will thrive.”
One reader pointed to a financial impact of the deal, “ADT's valuation will affect multiples/valuation across the industry.”
MILWAUKEE and CORK, Ireland—Johnson Controls and Tyco International, which announced plans to merge in January, today announced the post-merger executive line-up.
The deal is expected to close Oct. 1, 2016.
Seven corporate executive officers were named, and seven business leaders were announced.
Five of the seven corporate executive officers are JCI employees who currently hold the same role at JCI that they will at the combined company. Two of the corporate executive officers come from Tyco.
“As the market has speculated for some time now, most of the executive roles are going to JCI folks,” said Alper Cetingok, managing director of Raymond James.
“While the deal is structured as a merger for tax purposes, it really is Johnson Controls acquiring Tyco,” he said.
However, business leaders who will oversee fire or security-specific roles will go to Tyco people, Cetingok said. "That makes sense because one of the main reasons for the deal was to bring security expertise to Johnson Controls, which is seeking to become a world leader in delivering integrated building technologies," he said.
As was previously announced, Johnson Controls chairman and CEO Alex Molinaroli will serve as CEO of the combined company for the first 18 months, during which time Tyco CEO George Oliver will serve as president and COO. After 18 months, Oliver will take over as CEO.
Cetingok noted that Oliver came to Tyco from GE. “His background is well suited to take over the CEO role for a large industrial company like this,” Cetingok said.
Following are the seven corporate executive officers who will report to Molinaroli when the deal closes.
Grady Crosby will serve as vice president, public affairs & chief diversity officer–currently holds the same role with Johnson Controls
Simon Davis will serve as vice president & chief human resources officer–currently holds the same role with Johnson Controls
Kim Metcalf-Kupres will serve as vice president & chief marketing officer–currently holds the same role with Johnson Controls
Judy Reinsdorf will serve as executive vice president & general counsel–currently holds the same role with Tyco
John Repko will serve as vice president & chief information officer–currently chief information officer & enterprise transformation leader with Tyco
Brian Stief will serve as executive vice president & chief financial officer–currently holds the same role with Johnson Controls
Jeff Williams will serve as vice president, operations & engineering–currently holds the same role with Johnson Controls
Following is the list of business leaders who will report to Oliver upon completion of the merger. All of them currently hold the same role at either Tyco or JCI. Their current company is noted below.
Bill Jackson, executive vice president & president, Building Efficiency (JCI)
Trent Nevill, vice president & president, Asia Pacific (JCI)
Colleen Repplier, president, Fire Protection Products (Tyco)
Girish Rishi, executive vice president, North America Integrated Solutions & Services and Tyco Retail Solutions (Tyco)
Mike Ryan, president, Security Products and Life Safety Products (Tyco)
Johan Pfeiffer, executive vice president, Rest of World Integrated Solutions & Services (Tyco)
Joe Walicki, vice president & president, Power Solutions (Johnson Controls)
"We are pleased to reach this major milestone on our journey to bring two great companies together to create a global leader in building products and technology, integrated solutions and energy storage," Molinaroli said in a prepared statement.
"This team of talented executives will ensure the combined company continues to thrive, grow and create unique value for our customers and shareholders. We are looking forward to bringing our complementary capabilities together to turn the possibilities for smart buildings and urban environments into reality around the world."
CORK, Ireland—Johnson Controls this week completed its merger with Tyco, marking a historic turning point for both companies.
By uniting Johnson Controls, a provider of building efficiency solutions, with Tyco, a provider of fire and security solutions, the new company offers a comprehensive portfolio of products, technologies and integrated solutions for the buildings and energy sectors.
"We are more than just two businesses that have come together—we are now one team uniquely positioned to create value," Alex Molinaroli, Johnson Controls chairman and CEO, said in the announcement. "Our combined insights and world class technologies will help build even smarter, more secure and more sustainable environments that help our customers win and broadly move the world forward."
As a result of the robust integration planning already in place, the company is on track to realize $1 billion of savings related to previously announced merger synergies and productivity initiatives.
"In addition to identifying significant synergies and improvements, our integration teams put us in position to complete the merger a month ahead of schedule so we can hit the ground running and realize the value of the merger for customers and shareholders,” George R. Oliver, Johnson Controls president and COO said in a prepared statement. "We are ready to integrate the skill sets and capabilities of both companies and develop solutions to meet our customers' needs in ways neither company could on its own."
With $30 billion in revenue and 117,000 employees (following the anticipated spinoff of the Adient automotive business in October), this powerful combination can now provide product, technology and service capabilities across controls, fire, security, HVAC and energy storage, to serve the full spectrum of end markets including large institutions, government, commercial buildings, retail, industrial, small business and residential.
Tyco and Johnson Controls' buildings platforms create immediate opportunities for growth through cross-selling, complementary branch and distribution channel networks, and expanded global reach for established businesses.
Longer term, the company is positioned to drive new innovations in technology and business models to support the smart buildings, campuses and cities of the future as well as building upon strategic, high value-added services driven by data analytics and connectivity like the Retail Solutions and Connected Services businesses.
Johnson Controls also will have one of the largest energy storage platforms with capabilities spanning the technology spectrum to serve an expanding global energy storage market.
CORK, Ireland—Johnson Controls released a “call to action” whitepaper on cybersecurity this week in an effort to help the industry to better protect all of the data that is being produced throughout smart buildings today.
“As data becomes more and more prevalent throughout the buildings where we live and work, so does the need to protect that data; it is no longer enough for a building to be smart—it must now be cybersmart,” according to the new whitepaper, “Cybersmart Buildings - Securing Your Investment in Connectivity and Automation” published jointly by Johnson Controls and Booz Allen Hamilton, a management and technology consulting and engineering firm. This whitepaper provides a roadmap for building managers, building owners, contractors and others to act to protect their information.
“Research clearly demonstrates that cybersecurity is a critical need at a critical hour for buildings around the world,” Bill Jackson, president, Johnson Controls Global Products, said in the announcement. “As building technology and data converge, we must be increasingly vigilant.”
This collaboration between two companies, with more than 200 years of combined expertise in their industries, illustrates the progress being made in raising awareness of the need for cybersecure smart buildings, coined “cybersmart buildings” in the white paper.
“Securing smart buildings and building systems more generally, is a shared responsibility requiring focus and commitment from the manufacturer, integrator, and customer,” Jason Rosselot, director of Johnson Controls’ global product security, said in the release. “Just as two industry leading companies were able to collaborate to create this whitepaper, so too can smart building stakeholders partner to follow these recommendations and create cybersmart buildings.”
Jackson added, “Defending against cyber threats today and tomorrow requires the secure design, development and deployment of building automation systems and controls.”
According to the 2016 State of Industrial Control System (ICS) Security Survey by SANS, 67 percent of participants perceived severe or high levels of threat to control systems, up from 43 percent in 2015.
“Smart buildings are now at the forefront of this battle—with tremendous complexity and integration of systems, they represent an increasingly valuable target,” according to the whitepaper. “Connectivity and automation create entry points for cyber attacks with potential safety, continuity, quality and privacy impact. But we can’t let this risk cripple innovation.”
According to the whitepaper authors, cybersecurity can be “a business enabler for smart buildings. When done well, cybersecurity is about insuring your investment and assuring your ability to reap the transformative benefits that connectivity offers,” including working “with the right partners to secure your investments when assessing and deploying smart building systems or retrofits.”
The whitepaper, which can be found here, summarizes key insights to help set an agenda for cybersmart buildings.
CORK, Ireland—Since the Tyco-Johnson Controls merger was completed in September 2016, the two security giants have joined forces to become an industry powerhouse, leveraging the combined brands to provide innovation on both the product and integration side of the business.
Security Systems News caught up with Hank Monaco, VP, marketing, Building Solutions-North America, Johnson Controls, who has 17 years of experience with the legacy Tyco businesses. Monaco said that a major post-merger undertaking, and one that proved very beneficial, was the process of integrating two very large companies with such strong brand recognition.
“Both companies have significant histories and have a customer-orientated focus that revolves around themes like innovation and values like integrity and teamwork,” Monaco told SSN. “One of the internal steps that we have taken as an organization is to go through sessions that we call culture mapping, which got teams of people together from different walks of life, different functional areas, different parts of the business and different parts of the world and brought them together to look at a shared history of the two organizations and what the future holds for the new organization.”
He continued, “As we went through that process, what was striking to me were how many similarities there were along the way, and I think that is a testament to why this integration makes so much sense. And as we are going through that from a cultural perspective, there is a lot of work going on in terms of leveraging the terrific relationships that we have with customers across the different lines of business—fire, security, HVAC and controls—where we are now able to bring in a broader portfolio of services to solve a broader range of needs for our customers.”
From a branding perspective, the companies have been working to create a strategy that is “organized around Johnson Controls as the go-to-market brand globally,” he said, noting that that process will take place over the course of the next 12 to 18 months, and will be evident at the upcoming ASIS International show in Dallas next month. “And we also look at the other brands in the portfolio that have strong equity continuing to play a role in different ways. For example, the Tyco brand, which has strong brand equity in security is evolving right now to be a technology platform and brand, and that makes sense when you consider that our Tyco Security Products business is a products business. So those brands will stay a part of what we call our ‘famous brands’ portfolio.”
In regard to the Tyco systems integration side of the business, Monaco said it “is going to become even stronger, and that [the integration business] is a really big complement to everything that we do. When we look at the scale of the business, in terms of the depth of expertise that we have and the number of technicians that we have in every market around the country, it really is unmatched.”
One area that Johnson Controls will continue to expand is its cloud-based solutions.
“Our customers like that the cloud reduces their upfront costs, provides more built-in functionality over time and makes it easier for them to manage their systems,” said Monaco. “It also gives them greater flexibility in terms of future proofing technology that doesn’t require them to rip and replace. We have a variety of cloud-based services that we actually lead with for our customers, because they are very much interested in the benefits that come with that kind of platform.”
The cloud is also helping the company leverage the massive amount of data that is being produced by systems. “We have systems embedded in so many buildings around the world that some of the work we can do, and that we are doing, around leveraging information that we are getting from those systems is helping our customers solve a variety of problems, like false alarms,” Monaco explained.
Overall, the new Johnson Controls is an organization that is “focused like a laser beam on delivering an unparalleled customer experience in support of driving growth,” said Monaco. “So it is this idea of delivering exceptional service bundled with providing innovation solutions, that is really going to spur the growth of the company.”
Johnson Controls has approximately 13,600 employees spread out across 445 office locations worldwide, generating nearly $7.9 billion in gross revenue in 2016.