ADT announced that it has entered into an agreement to sell its commercial security, fire and life safety business unit to GTCR, a private equity firm, for US$1.6 billion.
The sale is expected to close in the fourth quarter of this year, pending customary closing conditions and regulatory approval, and has been approved by ADT’s board of directors. Proceeds from the sale will be used to reduce debt by US$1.5B.
“The decision to divest ADT’s commercial business is a value-enhancing transaction that focuses our portfolio on growth opportunities in our consumer markets,” said Jim DeVries, ADT president and CEO, in a statement. “The sale enables ADT to monetize the commercial business at an attractive valuation and accelerate our debt reduction goals. With greater financial flexibility, we will be better positioned to grow through our strategic differentiators and innovative offerings, including our partnerships with Google and State Farm. We will continue our journey to be the premier provider of safe, smart and sustainable solutions that meet the evolved definition of what safety means to consumers today.”
Chicago-based GTCR has previous experience with ADT: Protection 1 is a prior GTCR investment and merged with ADT in 2017. GTCR said in a statement it is partnering with former P1 executives Tim Whall and Dan Bresingham to acquire ADT Commercial. Bresingham, who is currently the executive vice-president of ADT Commercial, will become the company’s CEO upon close. Whall will join the company’s board.
“We are excited to again partner with Dan and Tim, as well as the incredible team at ADTC,” said David Donnini, managing director and head of business & consumer services, GTCR, in a statement. “This is a unique opportunity to invest in a successful business that we know well and helped develop, alongside partners that we have worked with for two decades. We believe making ADTC a standalone company strengthens its competitive positioning, sets up ADTC for future growth and builds upon GTCR’s history of successfully transforming businesses in the sector.”
ADT sold its Canadian business to Telus in 2019.
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