Securitas Seeks Purchases for Push Into More Markets

May 27 (Bloomberg) -- Securitas AB, the world’s second- largest security services company, plans to expand into 10 additional countries with the help of acquisitions to serve customers with global operations.
The Swedish supplier of guards and alarms, which operates in 40 nations, wants to be present in 50 “as quickly as possible,” Chief Executive Officer Alf Goeransson said at the company’s Stockholm headquarters. Singapore, Malaysia, South Korea, Indonesia and Italy are among the markets that it wants to enter, he said.
Expansion is key to serve those customers that have global operations and prefer to deal with one security provider, Goeransson said. Securitas, which counts Toyota Motor Corp. and Belgium’s new Musee Magritte Museum as clients, competes with market leader G4S Plc, which is also targeting emerging markets to drive growth.
“We’re trying to establish ourselves in all the markets where our customers have told us our presence is important,” Goeransson said in the interview yesterday. “We’re in most of these countries already but some are missing.”
Takeovers are the “easier and faster” option to entering a new market than building an operation from scratch, the CEO said. Securitas has about 1 billion kronor ($127 million) available for acquisitions this year, he said. Last year, it bought 15 companies with a total of 14,000 employees and sales of 1.3 billion kronor.
China Potential
China started allowing private security companies to operate there at the beginning of this year, and as a result Securitas now employs about 200 guards in the country, out of a total global workforce of about 260,000 employees.
The Chinese market likely has room for some 4 million security guards, many of whom would work for international companies operating there, he said.
“The possibilities are fantastic” in China, Goeransson said. “There’s plenty of market opportunities, plenty of customers. The problem for us right now is getting personnel, getting the guards licensed. They must be licensed and that’s not so easy with the Chinese bureaucracy.”
Securitas will come up against G4S in the pursuit of security contracts there. The British company is seeking expansion and may make purchases in China as the $9 billion market opens up, CEO Nick Buckles said in a Nov. 9 interview. China could initially add about 2 percentage points to revenue a year, he said then.
Both Securitas and G4S are little changed on Stockholm and London bourses this year. The Swedish business is valued at the equivalent of $3.2 billion, compared with its British rival’s market capitalization of $5.3 billion.

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