The acquisition builds on Telus’ expansion into the security business with an investment of $700mn
The Canadian telecoms company is expecting to close out its cash deal with ADT by the end of 2019. The acquisition builds on Telus’ recent investments in BCE Inc.s’ Alarm Force customers for $66.5mn.
“This acquisition furthers Telus’ commitment to leverage the power of technology to bring state-of-the-art convenience, control and safety into the lives, homes and businesses of more Canadians,” Telus said in a press release on 2 September.
More telecommunication companies are attempting to expand out of saturated markets like wireless, phone and media prevalent across developed nations. With the interconnectivity of house security, smart home appliances and energy management becoming more regular security has become an adjacent market to get involved in.
Telus already has a foundation within the security industry with its SmartHome Security and Secure Business companies started last year. Through use of its PureFibre networks Telus will “enhance connected home, business, security, IOT, cybersecurity, smart buildings, smart cities and health services for its customers in Canada,” according to the press release.
The deal will give ADT, based in Florida, a chance to shed its Canadian capital and focus on the US market. ADT president and CEO said in a statement, “Opportunities continue to develop for ADT in the areas of smart home integration, the expansion of the home security business into new demographics and ADT’s growth in commercial security,” DeVries said. “Importantly, these emerging opportunities are ideal for leveraging the trusted ADT brand as we continue generating strong free cash flow to drive shareholder value over the long term.”
ADT has advised it will look to use the money from the sale to fund a dividend of up to US$550mn to shareholders at 70 cents a share.