DENMARK-based facility services provider ISS has acquired Indian security firm SDB Cisco for an undisclosed amount. The acquisition secures ISS a leading position in one of the world’s fastest growing markets for outsourced services and provides ISS India with a comprehensive service offering of cleaning, catering, pest control and security, the company said in a statement.
Although ISS did not disclose the deal value it said the sellers are Sicagen, a listed company in Chennai, and Singapore-based Certis Cisco. SDB Cisco is a 60:40 joint venture between the MAC Group-promoted public listed company Sicagen India and Singapore-based Certis Cisco.
In a separate disclosure, Sicagen said it and its subsidiary South India House Estates & Properties Ltd. have received a total consideration of Rs 94.66 crore and Rs 10.52 crore respectively against the sale of its investments held in SDB Cisco (India) Ltd.
It is not clear how much did Certis Cisco gets from the transaction but the total deal value is estimated at around Rs 200 crore. SDB Cisco, in which Sicagen held as much as 54% as of March’09, had revenues of Rs 210 crore with net profit of Rs 13.77 crore for 2008-09.
The stake buy in SDB Cisco is ISS’ third large acquisition in India following Shivas (catering) in 2007 and Godrej (pest control) in 2009. SDB Cisco provides manned guarding, cash and valuable transportation, and electronic security services. SDB Cisco has had annual organic growth rates of 20-40% for the past five years and employs 27,000 people.
Post acquisition ISS India and SDB Cisco will have total 45,000 employees, making India the second largest ISS operation.
"India is one of the fastest growing economies in the world and will be for the foreseeable future. We expect strong double digit revenue growth in the years to come," said Jeff Gravenhorst Chief Executive Officer, ISS Group in a statement.
ISS will own 49% of the SDB Cisco while two employee welfare trusts will own the remaining 51% in the Indian firm.
Early this year, trading and services firm Sicagen India announced it has got into a share purchase deal with an unnamed buyer to sell its stake in SDB Cisco India.
The MAC Group had been looking to sell its 60% stake in almost four-decade-old JV, since early last year, as a part of strategy to exit all non-core businesses. The stake sale will help the diversified group to focus on core businesses such as petrochemicals, logistics and fertilisers.