Neu Capital acted as sole debt advisor to Intelligent Monitoring Group on securing A$80m of debt financing to fund the acquisition of ADT Security Australia and New Zealand from Johnson Controls International (NYSE:JCI).
With the acquisition of ADT Security, Intelligent Monitoring Group (ASX:IMB) became the largest provider of security monitoring services in Australia, with over 170,000 lines, up from 70,000 pre-acquisition.
The debt facility arranged by Neu Capital was used in conjunction with a A$15m equity raise to fund the purchase price and refinance the target’s existing debt.
By tapping into the private credit markets to leverage the ADT acquisition, IMB was able to:
Attracting a debt facility of this size was complicated by the limited amount of physical security and a historical cashflow profile that did not reflect the go-forward business, due to the legacy capital-expenditure-driven customer acquisition strategy. Neu Capital performed extensive analysis to derive normalised recurring cashflows, bolstering the debt serviceability narrative.
The acquisition facility was secured as a club deal between TOR Investment Management and Longreach Alternative Credit, which minimized the equity requirements of the acquisition.
