Mace Security International announced the divestiture of Mace, its wholesale monitoring business in a sale to Security Partners. The sale reflects the Board's continued commitment to maximizing shareholder value. The sale will enhance Mace's profitability while providing significant cash proceeds.
Mace Security International announced the divestiture of Mace, its wholesale monitoring business in a sale to Security Partners. The sale reflects the Board's continued commitment to maximizing shareholder value. The sale will enhance Mace's profitability while providing significant cash proceeds. The business was deemed by the Board to be a non-core asset after a strategic review of priorities and holdings. Due to an inability to scale the business cost effectively and the business's net contribution margin loss in 2013 - the sale was logical and strategic. Mace Security International will continue to offer alarm dealers exclusive Mace programs and products through Security Partners.
While terms of the sale are not being disclosed, the Company notified shareholders that the sale will add well in excess of $0.10 per share of working capital to the balance sheet with the vast majority of it being cash. The balance of the purchase price will be in the form of notes receivable which will be paid out over the next eighteen months, with front-loaded payments.
Significant strategic measures have been achieved in the past 2 years to position the Company for the future.
These measures include:
* Divestiture of car washes
* Divestiture of real estate
* Divestiture of wholesale monitoring business
* Resolution of regulatory (EPA suspension & potential debarment) issues
* Measures to cut excess corporate overhead which did not include marketing reductions
* Move of the entire company from a high cost, multi location structure to a single low cost facility
The sale of the Wholesale Monitoring Business will allow the Company to focus on its crown jewel, Mace branded personal defense and security products. The personal defense business is profitable, on a standalone pre-corporate overhead basis, and a substantial pipeline of new customers is being developed. With the Wholesale Monitoring Business divested, the Company does anticipate taking a one-time restructuring charge prior to the close of the calendar year. The charge relates to non sales and marketing corporate reductions which the Company expects will improve profitability in 2014.