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INSIGHTS

A closer look at ACRE’s acquisitions of Feenics and Matrix Systems

A closer look at ACRE’s acquisitions of Feenics and Matrix Systems
At the end of last year, ACRE announced the acquisitions of Feenics and Matrix Systems. In this note, ACRE CEO Joe Grillo explains the rationale behind the acquisitions and how the deals can benefit all companies involved.
At the end of last year, ACRE announced the acquisitions of Feenics and Matrix Systems. In this note, ACRE CEO Joe Grillo explains the rationale behind the acquisitions and how the deals can benefit all companies involved.
 
In December last year, ACRE acquired Feenic and Matrix Systems. Feenics, headquartered in Ottawa, Canada, is strong in the cloud-based access control business and is known for Keep, an ACaaS platform built specifically for and hosted in the public cloud. Matrix Systems, based in Miamisburg, Ohio, is an access control and video surveillance solutions provider with well-known end user customers in various verticals. These two companies add to ACRE’s existing portfolio of brands including Vanderbilt, TDS, ComNet, Open Options, Razberi and RS2.
 

Honoring pledge made to Triton

 
The acquisitions came months after ACRE was itself acquired by private equity firm Triton. In fact, the Feenics and Matrix deals were meant to honor a pledge ACRE made with Triton to expand in the security industry.
 
“Overall, both companies (Feenics and Matrix) are important investments for us as their solutions are complementary to our existing portfolio. ACRE was acquired earlier this year by Triton, an investment firm in Dublin, Ireland. Part of that acquisition included a pledge from ACRE to seek out brands dedicated to providing solutions for the growing demand of cloud and flexible integration in the access control and physical security markets. Feenics and Matrix are helping us achieve that goal and honor our pledge to Triton by being incredibly innovative and offering relevant solutions centered around these trends,” Grillo said.
 

Growing both organically and through acquisitions

 
The two acquisitions are the latest examples of ACRE being quite active in buying security companies. This gives the impression that ACRE will use acquisitions as a major growth driver instead of growing organically. Grillo however said ACRE will strive for both organic and acquisition growth.
 
This year (2021), one of our primary goals was to bring the industry’s best technology innovators into our network of brands. We have accomplished it. But we don’t pump the brakes here. We continue onward and our future growth will be driven by organic and acquisitive activities,” he said.
 

Rationale behind the Feenics and Matrix deals

 
According to Grillo, both Feenics and Matrix Systems were good fits for ACRE. Feenics is strong in ACaaS, a market that is fast growing and that ACRE wants to have a stronger presence in.
 
“The cloud services market in the physical security market is growing at a rapid rate and we want to continue to provide our partners and customers with multiple options to select from as they further build their digital transformation strategies. The Feenics solution, Keep, is a cloud-hosted platform that provides advanced scalability, unique flexibility, and exceptional security with its ACaaS applications, and helps us further build our cloud portfolio,” Grillo said, adding Feenics fits well with ACRE in other ways.
 
“Feenics was an attractive candidate for ACRE because not only is it profitable and has experienced double-digit growth, but it fits in well with our business, both in terms of culture and industry background,” he said. “Both Feenics core leadership team and ACRE's have decades of experience within the access control industry and are well known for developing strategies that result in steady, sustainable growth.”
 
As for Matrix, it was also a good fit for ACRE due to its long history, unique integration approach and strong customer base, Grillo said.
 
“For more than 40 years, Matrix Systems has been committed to protecting people, property, and assets through the delivery of security solutions and services tailored to the unique needs of its customers. Matrix’s simplified approach to integration have helped IT build significant loyalty from a wide range of customers in rapidly growing markets, and we look forward to supporting its continued growth,” Grillo said. “It has strengthened our presence in large-scale enterprise deployments as we’ve retained all its customers including General Electric, U.S. Steel, Kodak, airports in Cincinnati, Miami, Fort Lauderdale and, as well as Texas A&M, the Cleveland Clinic, Ohio State University Medical Center and Kettering Medical Center.”
 

Conclusion

 
Feenics and Matrix are the latest acquisition targets by ACRE, which has been quite active in the security M&A block. That, plus the pledge it made with Triton, gives us reasons to believe ACRE’s acquisition activities will continue. As for the larger security market – given it’s still quite fragmented, we can expect to see more acquisition deals this year.


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