Intelligent Monitoring Group

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:

  • Decrease leverage from 5.6x to 2.6x;
  • Minimise dilution and maximise EPS accretion for IMB shareholders;

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.

For further information, you can find the AFR article here. 

You can read the ASX announcement here. 

ASX: IMB Share Price

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