Acquisitions of Vanguarda and Interativa
Vanguarda was acquired from its founders and other directors, by G4S’ Brazilian subsidiary SSE DO Brasil Ltda.
Founded in 1975, Vanguarda is headquartered in São Paulo, Brazil, and has gross assets of £29m. Vanguarda provides security personnel, security systems and monitoring services and mobile patrols to key strategic sectors such as banking, transportation, commercial buildings, education, health and public services.
The acquisition of Vanguarda follows on from the purchase by SSE DO Brasil Ltda. of 100% of Interativa Service Ltda. (“Interativa”) from its founders and other directors in December 2011. Interativa provides unarmed security and facilities services. G4S’ strategy is to expand beyond security in selected large developing markets where the market opportunity is large and there is significant growth potential.
Also based in São Paulo, Interativa was founded in 1998 and has gross assets of £18m. Interativa provides services across Brazil in key sectors such as education, transportation, financial institutions, healthcare, public services, construction, chemicals and others.
The combined consideration for Interativa and Vanguarda was in line with the group’s normal multiple of 8 to 10 times the companies’ current year PBITA. Their combined revenue is approximately £165m, placing G4S as a leader in both the security and facilities management (FM) markets in Brazil and making Brazil one of the top three developing markets by revenue for G4S. G4S also has a systems integration and technology presence in Brazil.
The acquisition of Vanguarda is in line with G4S’ strategy to focus on markets and sectors where security and safety are key considerations. G4S businesses in developing markets currently represent 31% of group revenues with organic growth of 10% in the first half of 2012. G4S is targeting revenues of 50% of the group total from the fast-growing developing markets by 2019.
Nick Buckles, CEO of G4S said, "We are pleased to have made two strategically important acquisitions in Brazil. Vanguarda and Interativa will provide G4S with an excellent platform for growth in one of the world’s leading economies. We are delighted to welcome their experienced and capable management who will help us implement our strategy to invest in security and broader facilities services in the region. We are confident that these expanded service offerings and broadened capabilities covering security, facilities management and technology, provide us with excellent growth prospects in this large and exciting market.”
Notes to Editors:
Brazilian Security & FM Markets
Brazil is estimated to be the fourth largest security market in the world, and is expected to grow by approximately 10.5% per year, with a forecast market size of $16.6bn in 2019.
The facilities management market in Brazil is currently valued at approximately £10bn. Brazil’s spend on facilities management is approximately 6% of global FM expenditure. The FM market is anticipated to grow at a compound annual growth rate (CAGR) well above GDP growth.
All security companies providing armed security personnel in Brazil require a licence to operate from the Federal Police. Vanguarda has held such a licence since before 1983 and the Government has ruled that the licence can be maintained following the transaction.