Stolberg Agrees to Bolster Central Security Platform –

Stolberg, Meehan & Scano in July teamed up with security industry executive Mark Wilson to form Central Security Group, an alarm-monitoring holding company. Just a month later, the group, based in Tulsa, Okla., has agreed to purchase the base to its platform, Guardian Security Systems, in a deal slated to close in the fourth quarter.

Stolberg Partner Peter Van Genderen said his group put between $10 million and $15 million in equity into the deal, although he declined to discuss the total transaction price. LaSalle National Bank is providing a revolving line of credit, he said.

Alarm-monitoring companies measure revenue on a recurring monthly revenue basis, according to Van Genderen, because the bulk of their revenue comes from the monthly fees charged to customers. Companies such as Guardian Security-which is the oldest licensed security company in Oklahoma-sell and install alarm systems and also monitor clients’ alarms as long as they pay a monthly fee.

Guardian Security reports monthly revenue of $160,000, or approximately $4 million in annual revenue for 1998, once equipment sales and installation service charges were added in, Van Genderen said.

Central Security will attempt to execute a platform strategy, acquiring additional companies, mainly in the Midwest, with yearly revenues of approximately $1 million, Van Genderen said.

Alarms Music to Stolberg’s Ears

The company is looking to create a national dealer program to purchase business and residential alarm-monitoring contracts in regions where it is looking to expand, as well as consolidating its existing monitoring stations into one central monitoring station located in Tulsa.

Van Genderen described Wilson, president of the newly-formed company, as a “monster talent” in the security business. Prior to partnering with Stolberg, Wilson was an executive at Multimedia Security Service, which last year was acquired by Protection One Alarm Monitoring for $230 million.

Denver- and New York-based Stolberg makes equity investments in business service companies. Its recent business-to-business acquisitions include ECOM Worldwide, Capital Returns and Advanced Telecommunications Inc. Yale University is the group’s lead investor.