GE Capital has sold its stake in SAFE Security, a San Ramon, Calif.-based security alarm company, to Rustic Canyon/Fontis Partners. No pricing terms were disclosed, except that the deal included a $25 million senior credit facility from Bank of America.
GE Capital, one of four major units of General Electric Company (NYSE: GE), has sold its entire stake in SAFE Security®, one of the nation’s largest security alarm companies, to Los Angeles-based private equity firm Rustic Canyon/Fontis Partners, LP.
As part of the transaction, Bank of America has provided a $25 million senior credit facility. Rustic Canyon/Fontis Partners has invested an undisclosed amount of new equity capital in SAFE Security and has assumed a majority ownership position. SAFE Security’s founder and CEO, Paul Sargenti, also will retain a significant ownership interest.
“This transaction marks a new beginning for SAFE Security, one that will build upon a solid foundation, unleash the company’s growth potential and provide us with an ability to offer an even wider array of quality products and services to our customers nationwide,” said Sargenti, who founded the company in 1988. “By enhancing our financial flexibility, SAFE Security will be in an excellent position to execute on its long-term growth plan, which includes geographic expansion and strategic acquisitions.”
“We are excited to be collaborating with Paul and his experienced and highly motivated management team,” added Gabrielle E. Greene, general partner of Rustic Canyon/Fontis Partners. “We believe the injection of our resources and expertise will help to uniquely position SAFE Security for growth.”
SAFE Security is among the largest security alarm companies in the United States, with operations in 44 states. It is involved in purchasing, financing and servicing residential and commercial security alarm monitoring contracts, as well as installing alarm systems.
The company has built a sound reputation for offering reliable, state-of-the-art security equipment, superior customer service and the most robust, secure monitoring technology available. With a core focus on “protecting lives and property,” SAFE Security has streamlined its organization to operate more efficiently, while providing increased value to its customers. Recent initiatives have included software upgrades throughout the enterprise, consolidation of monitoring stations, an improved service infrastructure and a broadened installation capacity.
Particularly with the economic downturn, Sargenti said security alarm systems are an important line of defense for residences and businesses looking for increased protection. Additionally, he noted that having a security system typically provides for a property insurance premium discount, that, in turn, often covers the cost of monitoring.
Salt Lake City-based investment bank Seare Marriott & Co. served as financial advisor on the transaction. Managing Director Gregory Seare said, “This is an important milestone for SAFE Security and the team at RC Fontis. It is particularly gratifying to have advised on this transaction during the current economic environment. Its completion demonstrates the strength of SAFE Security and its solid core customer base.”
Bank of America Senior Vice President, and Senior Client Manager David Stang said, “Bank of America is pleased to have played an important role in this transaction. We are confident in the growth potential of SAFE Security and its strong management team.”
About Rustic Canyon/Fontis Partners
Rustic Canyon/Fontis Partners, LP is a Los Angeles-based private equity fund, investing principally in companies in the Southwest with sales between $10 million and $100 million. For more information, visit the company’s website at www.rcfontis.com.
About SAFE Security®
SAFE Security® (Security Alarm Financing Enterprise, L.P.), headquartered in San Ramon, Calif., is one of the nation’s leading security alarm companies engaged in the business of purchasing, financing and servicing residential and commercial security alarm monitoring contracts. SAFE Security actively markets and installs alarm systems and monitoring to homeowners across the nation in addition to growing a robust dealer account acquisition program. For more information, visit the company’s website at www.safesecurity.com.