Comvest Exits Red Hawk

Comvest Partners has agreed to sell Red Hawk Fire & Security to publicly-traded ADT for $317 million in cash.

Comvest formed Red Hawk Fire & Security in April 2012 when it acquired the US fire and security operations of United Technologies. Today, Red Hawk installs, tests, inspects, integrates, services and monitors safety and security systems for approximately 50,000 businesses nationwide. Red Hawk is one of the few remaining independent national commercial integrators and is expected to generate approximately $300 million of revenue in 2018. The company is headquartered in Boca Raton, FL (www.redhawkus.com).

“We are delighted to join a company with ADT’s resources, growth potential and shared commitment to providing high-quality customer service and innovative solutions to customers,” said Red Hawk President and CEO Michael McWilliams. “We look forward to our future with ADT, which we are confident will help us to achieve our next phase of growth.”

“It was a rewarding and collaborative experience working with Michael McWilliams, Mark Foley, Red Hawk’s CFO, and the other members of Red Hawk’s senior management team to build Red Hawk into a market leader from our original acquisition, and Red Hawk is positioned to continue to thrive under ADT’s leadership,” said Roger Marrero, the Managing Partner of Comvest.

Comvest provides debt and equity to middle-market companies. For debt investments, the firm will invest from $20 million to $200 million per transaction in companies with at least $20 million of revenue and EBITDA of at least $5 million. For equity investments, the firm will invest from $35 million to $125 million of equity per transaction in companies with $50 million to $1 billion of revenue that have positive or negative EBITDA. Sectors of interest include business services, consumer & retail, healthcare services, industrials, and transportation & logistics. Comvest is based in West Palm Beach with additional offices in Chicago, New York, and Los Angeles (www.comvest.com).

ADT is one of the largest providers of security services in the United States and Canada with annual revenues of more than $4.3 billion.  ADT is headquartered in Boca Raton, FL and employs approximately 17,500 people throughout North America (www.adt.com).

Financing is being provided by Joint Lead Arrangers Barclays, Citigroup Global Markets, Citizens Bank, Deutsche Bank, and RBC Capital Markets, as well as Credit Suisse, Goldman Sachs, and Morgan Stanley.

Raymond James is the financial advisor to ADT, and Jefferies and Lincoln International are serving as financial advisors to Red Hawk.

This transaction is expected to close by the end of the fourth quarter of 2018.

© 2018 Private Equity Professional | November 1, 2018

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