Security and Intelligence Services (SIS), a Delhi-based private security provider, is close to acquiring SDB Cisco for around Rs 300 crore. The company may form a special purpose vehicle (SPV) along with a private equity partner for the acquisition, reports Economic Times.
SIS has been backed hedge fund DE Shaw. Chennai-based SDB Cisco is a 60:40 joint venture between MAC Group and Singapore-based Certis Cisco. The report adds that AC Muthiah-led MAC Group is looking to sell its stake in the firm. Private equity funds like Carlyle, Sequoia Capital, Actis and TVS Capital are also in the fray to pick up a stake.
SDB Cisco provides security and cash-in-transit management services and has revenues of Rs 200 crore. It has an employee strength of around 25,000 security guards with 1,400 across the country.
SIS last year acquired the guarding and patrol business units of United Technologies Corp (UTC) in Australia. The units had revenues of $400 million. SIS had partnered with DE Shaw for that acquisition.
The acquisition of SDB Cisco will be a good strategic fit for SIS as it would help the latter expand to markets in southern and western India. DE Shaw had bought 14% stake in SIS for around Rs 300 crore $75 million in early 2008, valuing the company at about Rs 2,150
crore $525 million.
MAC Group is looking to sell its non-core assets, and selling of security business is part of that. The fund raised from this sale will be used in its core businesses like fertilisers, petrochemicals and
The private security market in India is growing at 25% every year and is said to be worth Rs 10,000 crore. Topsgroup is another player in this market, and received private equity funding from ICICI Venture, Indivision, the investment of arm of the Future Group, and Rakesh
Jhunjhunwala. Denmark-based Group 4 Securicor and Brinks Arya are other major players in this market.
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