Rapid changes in the physical security market this year have largely overshadowed one arena where change has slowed down in 2017 – mergers and acquisitions (M&A). Although there were no “mega-mergers” as in years past (such as Axis-Canon and Johnson Controls-Tyco, M&A activity still made headlines last year on SourceSecurity.com. In 2017, we wrote about M&A news involving companies such as HID Global, Eagle Eye Networks, ADT, and Honeywell. 


Here’s a look at the Top 10 M&A stories in 2016, as reported by SourceSecurity.com:

1. HID Global acquires Mercury Security

HID Global, a subsidiary of ASSA ABLOY specialising in trusted identity solutions, agreed in 2017 to acquire Mercury Security, an OEM supplier of controllers for physical access control. Mercury Security has over three million controllers installed at tens of thousands of sites worldwide, including at more than 90 of the Fortune 100 companies. Mercury’s intelligent controllers, interface boards and software complement HID Global’s readers, smart cards and mobile IDs for opening doors. 

2. ASSA ABLOY acquires August Home Smart Locks

ASSA ABLOY signed an agreement to acquire August Home, a leading smart lock business in the United States, reinforcing the company’s position in the residential smart door market. The acquisition includes expansion into complementary smart locks, video doorbells and comprehensive solutions for home delivery. August was founded in 2013. It is headquartered in San Francisco, California.

3. Eagle Eye Networks buys Panasonic CameraManager

One of the largest companies in the cloud video sector, Eagle Eye Networks, aggressively expanded its offerings to the fast-growing market, and its geographic reach, with acquisition this year of Panasonic’s cloud-based video business, including the CameraManager and NuboCam brands. The acquisition expands Eagle Eye Networks’ coverage in the European region, where the CameraManager system is popular, and will include two additional data centres, to be added to EagleEye Network’s existing global network of seven data centres. The acquisition also includes existing CameraManager coverage in Latin America and Asia.

4. dormakaba acquires Stanley Black & Decker’s Mechanical Security

Stanley Black & Decker agreed to sell the majority of its Mechanical Security businesses to dormakaba for $725 million in cash. The sale included the commercial hardware brands of BEST Access, phi Precision and GMT. The remaining part of the Mechanical Security businesses, Sargent and Greenleaf, was not included in the sale.

5. ADT Acquisitions include cybersecurity firm

ADT, provider of security and automation solutions for homes and businesses in North America, announced the acquisition of DATASHIELD, one of the country’s fastest growing cybersecurity companies. Now operating under the brand ADT Cybersecurity, this service is positioned to provide Enterprise and Mid-Market businesses with Managed Detection and Response (MDR) services to combat advanced cyber threats in real time. The acquisition in November closed out a busy year for ADT on the M&A front, including acquisition of commercial security systems integrators Protec in the Pacific Northwest, Gaston Security in Emporia, Va., and MSE Corporate Security in Branchburg, N.J.

6. Honeywell acquires Nextnine

Another big player making a move in the cybersecurity sector was Honeywell, which completed acquisition of Nextnine Ltd., a privately held provider of industrial cyber security solutions. The business is being integrated into Honeywell’s Industrial Cyber Security group and will strengthen Honeywell’s capability to offer multi-vendor, multi-site secure remote access, monitoring and support to protect industrial control systems and critical infrastructure against a growing threat of cyber-attacks.

7. HID Global buys Arjo Systems

In addition to buying Mercury Security, HID Global also expanded its business in physical and digital identity solutions for secure government ID applications in 2017 with the acquisition of Arjo Systems. The move gives HID Global broader capabilities to deploy electronic identification (eID) and ePassport solutions for government programs. The acquisition also brings together complementary strategies, customer bases and offerings that have strong synergies to support continued innovation for government-to-citizen ID customers.

8. Allied Universal acquires ALERT Protective Services

Allied Universal further expanded its footprint in North America with the acquisition of ALERT Protective Services, a residential community security firm based in Sarasota, Florida. Like Allied Universal, ALERT Protective Services offers integrated security systems and uniformed security professionals to work in tandem with a complete security program at community gatehouses, concierge desks, or security command centres. 

9. Veracity buys iComply software company

Veracity, a provider of transmission, storage, and display solutions for IP video, announced in 2017 the acquisition of iComply, a software provider of integrated command and control security solutions. The agreement includes all operational staff, software, intellectual property, ongoing business, and also iComply’s sales and support subsidiary in India. Veracity will maintain iComply as a separate business and expand its operations. Veracity planned to sell software based on icomply’s technology under the Veracity brand in the U.S. market, but will keep the separate brands in the United Kingdom, where icomply is better known.

10. Robotic Assistance Devices acquired by On the Move Systems

Robots came on the security scene in a high-profile way in 2017. On the M&A front, Robotic Assistance Devices (RAD), north American master distributor for SMP featuring exclusive power and other special technology, and a North American distributor for SMP Robotics, announced its acquisition by On the Move Systems (OMVS). The merger with OMVS allows RAD access to capital to scale its product portfolio and further increase its market position as a leader in the robotic guard market.

Download PDF version

Author profile

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.

In case you missed it

What characteristics do salespeople require in the physical security industry?
What characteristics do salespeople require in the physical security industry?

A basic tenet of sales is ABC – always be closing. But it's a principle that most professional salespeople would say oversimplifies the process. Especially in a sophisticated, high-tech market such as physical security, the required sales skills are much more involved and nuanced. We asked this week's Expert Panel Roundtable: What unique characteristics are required of salespeople in the arena of physical security systems?

Can microchip implants replace plastic cards in modern access control?
Can microchip implants replace plastic cards in modern access control?

A futuristic alternative to plastic cards for access control and other applications is being considered by some corporate users in Sweden and the United Kingdom. The idea involves using a microchip device implanted into a user’s hand. About the size of a grain of rice and provided by Swedish company Biohax, the tiny device employs passive near field communication (NFC) to interface with a user’s digital environment. Access control is just one application for the device, which can be deployed in lieu of a smart card in numerous uses. Biohax says more than 4,000 individuals have implanted the device. Using the device for corporate employees Every user is given plenty of information to make an informed decision whether they want to use the deviceCurrently Biohax is having dialogue with curious corporate customers about using the device for their employees. “It’s a dialogue, not Big Brother planning to chip every employee they have,” says Jowan Österlund, CEO at Biohax. Every user is given plenty of information to make an informed decision whether they want to use the device. Data capture form to appear here! “Proof of concept” demonstrations have been conducted at several companies, including Tui, a travel company in Sweden that uses the device for access management, ID management, printing, gym access and self-checkout in the cafeteria. Biohax is also having dialogue with some big companies in the United Kingdom, including legal and financial firms. Österlund aims to have a full working system in place in the next year or so. A Swedish rail company accepts the implanted chip in lieu of a paper train ticket. They accept existing implants but are not offering to implant the chips. Österlund says his company currently has no plans to enter the U.S. market. The device is large enough to locate easily and extract if needed, and small enough to be unobtrusive Access control credential The device is inserted/injected below the skin between the index finger and the thumb. The circuitry has a 10-year lifespan. The device is large enough to locate easily and extract if needed, and small enough to be unobtrusive. The only risk is the possibility of infection, which is true anytime the skin is pierced, and the risk is mitigated by employing health professionals to inject the chip. Use of the device as an access control credential or any other function is offered as a voluntary option; any requirement by an employer to inject the device would be illegal, says Österlund. It’s a convenient choice that is made “based on a well-informed decision by the customer.” Aversion to needles, for example, would make some users squeamish to implant the device. More education of users helps to allay any concerns: Some 10% of employees typically would agree quickly to the system, but a larger group of 50% to 60% are likely to agree over time as they get more comfortable with the idea and understand the convenience, says Österlund. Protection of information The passive device does not actively send out any signals as you walk. It is only powered up by a reader if a user has access rightsIn terms of privacy concerns, information contained on the device is in physical form and is protected. The passive device does not actively send out any signals as you walk. There is no battery. It is only powered up by a reader if a user has access rights. With use of the device being discussed in the United Kingdom, there has been some backlash. For example, Frances O’Grady, general secretary of the Trades Union Congress (TUC), has said: “Microchipping would give bosses even more power and control over their workers.” A big misconception is that the chip is a tracking device, says Österlund. It isn’t. “We love people to get informed,” says Österlund. “If they’re scared or apprehensive, they can just read up. It’s not used to control you – it’s used to give you control.”

Ethical consumption: should you buy security products ‘Made in China’?
Ethical consumption: should you buy security products ‘Made in China’?

Should ‘Made in China’ be seen as a negative in security systems and products? It’s an important and complex issue that merits a more detailed response than my recent comment in the Expert Panel Roundtable. For me, there are two sides of the answer to this question: Buying products that have certain negative attributes that are not in alignment with some part of a belief system or company mandate. Buying products that do not perform as advertised or do something that is unacceptable. For integrators and end users making the buying decisions, the drive to purchase products may not be based on either aspect and instead on the product that can do the best job for their business. But for others, a greater emphasis on the ethical implications of purchasing decisions drives decision-making. What is ethical consumption? Ethical consumption is a type of consumer activism that is based on the concept of ‘positive buying’ in that ethical products are favouredEthical consumption — often called ethical consumerism — is a type of consumer activism that is based on the concept of ‘positive buying’ in that ethical products are favoured, and products that are ethically questionable may be met with a ‘moral boycott’. This can be as simple as only buying organic produce or as complex as boycotting products made in a totalitarian regime that doesn't offer its citizens the same freedoms that we enjoy in the United States. Consider the goals of the Boston Tea Party or the National Consumers League (NCL), which was formed to protect and promote social and economic justice for consumers and workers in the United States and abroad. Some examples of considerations behind ethical consumption include fair trade, treatment of workers, genetic modification, locally made and processed goods, union-made products and services, humane animal treatment, and in general, labour issues and manufacturing practices that take these factors into account. Increase in ethical consumption The numbers show that ethical consumption is on the rise. In a 2017 study by Unilever, 33 percent of consumers reported choosing to buy and support brands that they believe are doing social or environmental good. In the same study, 53 percent of shoppers in the United Kingdom and 78 percent in the United States said they feel better when they buy products that are ‘sustainably’ produced. There’s clear evidence that products from some Chinese companies suffer from cybersecurity vulnerabilities Though the aforementioned question that sparked this conversation centres around concerns with products made in China, there are many other countries where, for example, governments/dictators are extremely repressive to all or parts of their populations, whose products, such as oil, diamonds, minerals, etc., we happily consume. There are also a number of countries that are a threat in terms of cybersecurity. It may be naive and simplistic to single out Chinese manufacturers. Impact on physical security products Product buying decisions based on factors other than product functionality, quality and price are also starting to permeate the security marketplace. While this hasn't been a large focus area from the business-to-business consumption side, it's something that should be considered for commercial security products for a variety of reasons. Hardware hacks are more difficult to pull off and potentially more devastating" There’s clear evidence that products from some Chinese companies suffer from cybersecurity vulnerabilities. Last fall, 30 U.S. companies, including Apple and Amazon, were potentially compromised when it was discovered that a tiny microchip in the motherboard of servers built in China that weren't a part of the original specification. According to a Bloomberg report, “This attack was something graver than the software-based incidents the world has grown accustomed to seeing. Hardware hacks are more difficult to pull off and potentially more devastating, promising the kind of long-term, stealth access that spy agencies are willing to invest millions of dollars and many years to get.” This, along with many other incidents, are changing the considerations behind purchasing decisions even in the physical security industry. Given that physical security products in general have been lax on cybersecurity, this is a welcome change. Combating tech-specific threats In early January, members of the U.S. Senate introduced bipartisan legislation to help combat tech-specific threats to national security posed by foreign actors and ensure U.S. technological supremacy by improving interagency coordination across the U.S. government. The bill creates the Office of Critical Technologies & Security at the White House, an indication that this issue is of critical importance to a number of players across the tech sector. Members of the U.S. Senate introduced bipartisan legislation to help combat tech-specific threats to national security posed by foreign actors To address a significant number of concerns around ethical production, there are certifications such as ISO 26000 which provides guidance on social responsibility by addressing accountability, transparency, ethical behaviour, respect for stakeholder interests, respect for rule of law, respect for international norms of behaviour and respect for human rights. While still emerging within physical security, companies that adhere to these and other standards do exist in the marketplace. Not buying products vulnerable to cyberattacks It may be counter-productive, even irresponsible, to brand all products from an entire country as unfit for purchasing. Some manufacturers’ products may be ethically questionable, or more vulnerable to cyberattacks than others; so not buying products made by those companies would make sense. The physical security industry might be playing a bit of catch up on this front, but I think we're beginning to see a shift toward this kind of responsible buying behaviour.