We don’t usually report on financial news here, but a recent financial move by up-and-coming industry leader Hikvision warrants attention. Specifically, Hikvision in Hangzhou, China, has secured a $3.1 billion line of credit from the government-owned China Development Bank.

Companies use a variety of financing tools to provide the currency they need to fuel growth, so in that regard, Hikvision’s move is to be expected. Given their ambitious growth timeline, both in China and throughout the world, it’s no surprise that they would be creating mechanisms to finance that growth.

The surprise here is the size of the move. To put $3.1 billion into perspective, consider that Canon paid $2.8 billion when they bought Axis, and that transaction generated tons of interest in the industry and, arguably, shook up the whole market. Obviously, with $3.1 billion of credit at their disposal, Hikvision is well equipped to shake up the industry, too.

For fast-growing Hikvision, $3.1 billion is an amount greater than its reported sales revenue of $2.78 billion in 2014.

“The company is focused on global growth,” says Alex Asnovich, Head of Marketing at Hikvision USA. “Talking about North America, we are opening our new Hikvision USA headquarters in the Los Angeles area in the summer of 2016. We have our new logistics facilities in Miami to support North and South Americas. We recently opened our Hikvision Canada headquarters office in Montreal and started our own bilingual English and French Canadian tech support center on the East Coast.”

Hikvision’s R&D operations

R&D is also a big part of the picture. I saw the scale of Hikvision’s R&D operations first-hand on my China visit earlier this year. The company has more than 5,400 engineers, including more than 2,000 software engineers. I also saw the construction site for a new 28-floor facility, adjacent to Hikvision’s other two high-rises in Hangzhou. When the new tower opens in 2018, a large part of it will be devoted to research and development. Hikvision has said its research focuses on such topics as perceptive technology, intelligent analysis, Big Data and cloud storage.

“We also plan to build up our R&D resources in North America,” says Asnovich. “Globally, our new European facilities are opening in 2016 in a new building the company owns, and we are also opening new branches and facilities on other continents.”

Hikvision is looking beyond security, with possible expansion into market segments like drones
Hikvision is looking to expand into other market segments such as drones


Growing a business costs money, and growing a large business this much takes a lot of money. Hikvision reportedly plans to use $1.6 billion of the credit line inside China, and $1.5 billion outside China, including the important U.S. market. 

Expansion into different markets

Hikvision is looking beyond security, too, and the line of credit will help to finance expansion into market segments such as robotics, industrial machine vision, and drones. There was a hint of what’s to come at the China Public Security Expo in October in Shenzhen, where attendees crowded around a demonstration of a Hikvision drone (available now in the Chinese market).

Could an acquisition be in Hikvision’s future? “The line of credit we recently received could prepare us in advance of an M&A opportunity, if and when a good prospect arises,” Asnovich comments. Possible Hikvision acquisitions in the United States have long been a topic of cocktail hour rumors and speculation in the security market.

“It is certainly a large amount of money for the security environment,” says Asnovich. “However, it’s not atypical for many other industries. This is not the first time for Hikvision to receive a substantial line of credit.” For example, the company recently was also extended lines of credit for 5 billion Chinese Yuan (around $0.77 billion USD) from international financial organisations such as Deutsche Bank, Citibank, HSBC, and others. 

Needless to say, Hikvision’s future ambitions in the security market, and others, are well financed. If the amount of available funds reflects the scope and nature of that expansion, we might expect some dramatic moves from Hikvision in 2016.

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Larry Anderson Editor, SecurityInformed.com & SourceSecurity.com

An experienced journalist and long-time presence in the US security industry, Larry is SourceSecurity.com's eyes and ears in the fast-changing security marketplace, attending industry and corporate events, interviewing security leaders and contributing original editorial content to the site. He leads SourceSecurity.com's team of dedicated editorial and content professionals, guiding the "editorial roadmap" to ensure the site provides the most relevant content for security professionals.

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