This article originally appeared as the cover story in the April 2024 issue of Security Business magazine. Don’t forget to mention Security Business magazine on LinkedIn and @SecBusinessMag on Twitter if you share it.
In August 2023, ADT shocked the security industry by announcing it would shed its commercial division and concentrate on the residential and smart home markets. It marked a new beginning for the company known since 2019 as ADT Commercial.
It is a company that has been known, at least in segments, by so many successful names – from Tyco to Protection One, from Red Hawk to ASG and ADT. The company is now known as Everon, and its road to success as a security integration powerhouse could be described as more of a cul-de-sac than a winding path, as it has emerged from the ADT conglomerate as a standalone global security integration stalwart, combining the many talented, familiar-faced individuals and expertise that characterized its roots with a variety of new acquisitions and a new-again flow of private equity money from a familiar source.
The result is a company eager to shed all its previous identities to become united under a guiding principle, says CEO Dan Bresingham.
“I wanted to pick a new name for sure, and one of the reasons I liked Everon is because it doesn’t necessarily connotate fire and security and life safety,” Bresingham explains. “Instead, we are protecting people’s lives and property all the time – so ever-on protecting property, ever-on evolving, ever exceeding customer expectations. By choosing a new name, we purposely said, ‘We’re not Protection 1, we’re not Red Hawk, [we are not ADT] – this is a new journey.”
By the end of 2024, all the company’s facilities, trucks, and materials will no longer bear the iconic ADT name. The company will be guided, once again, by the same team that created the Protection One commercial business essentially from scratch.
The Circle Begins
GTCR, the private equity firm that closed on its purchase of the commercial division of ADT in October 2023, is no stranger to the industry; in fact, GTCR and Tim Whall’s relationship dates back decades; and it is then where the cyclical path of Everon began.
One year after forming Cambridge Security with Jim Covert, GTCR acquired SecurityLink for Cambridge in 2000, and the Whall-GTCR relationship flourished. Covert and Whall quickly converted SecurityLink into a strong competitor in the commercial market – strong enough to attract the attention of Tyco/ADT, which purchased the company just six months after GTCR acquired it. Whall remained with the business, eventually rising to president until another interesting partnership with GTCR presented itself, in the form of Honeywell Security Monitoring (HSM).
Whall was the key executive who took charge of HSM in June 2004, following GTCR’s acquisition. It is here where Bresingham came into the picture as one of the company’s key executives. Again, Whall and Covert transformed HSM into a commercial security standout, and it caught the attention of Stanley, which purchased HSM in 2007. Bresingham stayed on to become CFO; Whall eventually moved on.
It was no surprise three years later, when GTCR and Whall teamed again to acquire Protection One and transform the residential-focused company into a dual-threat resi/commercial player. “The national footprint of Protection One positions the company well to accelerate growth in the attractive area of commercial sales,” Whall said at the time. “We will continue to cultivate Protection One’s strong base in residential sales while leveraging the company’s strengths within its developing commercial business through the use of new technology applications and an expansion of its sales force.”
Bresingham and Whall were reunited and tasked with creating the commercial offering of Protection One. “Ironically, the Protection One business looked a lot like ADT – it was primarily residential and small business,” Bresingham says. “We created a commercial business from scratch.”
Most people in the security business know how successful Protection One became – so successful in fact that in 2015, rival private equity player Apollo acquired P1 from GTCR and merged it with another major commercial integrator, ASG. One year later, Apollo acquired ADT for nearly $7 billion in a leveraged buyout and folded it into the merged P1/ASG – with the whole thing operating under the ADT name, marking the end of the Tyco/ADT conglomerate.
It took three years for the commercial unit to gain its own identity within the ADT behemoth, but the new branding rolled out in 2019 at ISC West, with ADT Commercial representing the remnants of Tyco Integrated Security, Protection 1, ASG, Aronson Security Group, and the new (at the time) acquisition of commercial security giant Red Hawk Fire & Security. Red Hawk’s leader, Mike McWilliams, became an integral component in the development of the ADT Commercial segment.
“Within ADT, that meant if you were touching a commercial customer, you essentially reported to me and Mike,” Bresingham explains. “We created our own infrastructure, and we went to market as ADT Commercial because the needs of our commercial customers were so different than resi.”
The long circle came back around in 2023, and what’s old is new again – as GTCR and Whall, from his seat on the Board of Directors, joined forces again with Bresingham to lead a commercial security venture – purchasing ADT Commercial.
“Essentially, what GTCR purchased is the commercial side of the P1 business that we started back in 2010, along with the enhancement of Red Hawk [and other tuck-in acquisitions],” Bresingham says. “At P1, we did a great job in national accounts and the smaller stuff; Mike’s expertise with Red Hawk was in the big stuff – data centers, huge distribution centers, healthcare campuses. With Mike’s help now, Everon can really provide soup-to-nuts for commercial customers, and we think we are unique there.”
It is certainly up for debate as to why ADT decided to divest its full commercial division after such a historically successful relationship that included no less than 20 integrator acquisitions over the past six years. Some speculate it was the Google and new State Farm players who prefer a laser focus on smart homes and residential. Others say it was simply something that ADT shareholders demanded to lessen the company’s debt load.
Whatever the reason, it opened a new chapter in the company’s history, and Everon is already one of the most active integrators in the market, from project wins to M&A activity.
“We are excited because now we get to hold our destiny without asking a corporate parent what to do,” Bresingham says. “ADT was a great parent. In the COVID year, they helped us immensely. I couldn’t think more favorably of how ADT treated us, but now we get to call our own shots again. It was just fortuitous for us as now Everon that we were able to partner with GTCR and move forward.”
The Next Steps
Bresingham and McWilliams’s first order of business post-acquisition was the name change. They wanted to move fast and capitalize on the buzz of the change while they still had the industry’s attention.
“The ADT brand is obviously very strong – when you say you work in the security business to anybody at a barbecue, the first thing they ask is if you work for ADT,” McWilliams says. “But it is just not the same brand recognition in the commercial space, especially in the larger commercial markets, [such as] airports, hotels, campuses, and hospitals. The Everon name makes it simpler. Quite honestly, over the last five years, we have spent a lot of time explaining to customers that we are not the residential side of ADT, we’re the commercial side. As Everon we don’t have to walk that path anymore.”
McWilliams says his team has talked to all the company’s top customers. “There’s just genuine excitement. It’s cleaner, and [they] understand it.”
The next step was improving the company’s back-end infrastructure. Bresingham says that even though they were successful under ADT’s system, they decided to create a new, modern infrastructure unique to Everon. “That will allow us to run faster, provide better service to our customers, allow our employees to do more, and streamline the business,” he says.
Having gone through a similar process when Red Hawk was acquired by ADT, McWilliams – and Bresingham for that matter – are no strangers to merging new companies into the fold. “[The nice part about] this carve-out is we are bringing all of our employees with us,” McWilliams says.
Growth via Acquisition
One thing that should not be a surprise to anyone in the know is that a company powered by an aggressive private equity firm is interested in fast but achievable growth – much of which comes via targeted mergers and acquisitions. ADT Commercial itself was a prolific acquirer of security integration companies over the years, and the company’s push for acquisitions under the Everon name has carried the same sort of momentum.
“Obviously between Dan and myself, we’ve done a lot of M&A over the years,” McWilliams admits.
One person who is no stranger to the process is Michael Kennedy, who joined ADT Commercial when he sold his Arkansas-based integration company, Advanced Cabling Systems, to ADT in 2019. Like many business owners who sell to ADT, he remained with the company and is now its Vice President of Mergers & Acquisitions.
Since GTCR’s acquisition, Kennedy has been quite busy. Everon has acquired five integration companies in just the three months of December, January, and February. It started with the addition of Newtech Systems of Kentucky and continued with Portland Safe of Maine, Apex Integrated Security Solutions of Idaho, Customized Service Concepts of New England, and Michigan-based Riverside Integrated Systems.
“Over the last 12 months we have looked at 100-plus deals and bought five,” Kennedy says. “It comes down to finding great leaders who have built a great culture before you ever talk about the geography, or the solutions they offer, or how it fits into our Everon business. If we make the connection, and we like the team, and we like the culture they’ve built and their reputation in the market, then it comes down to where we need help geographically as we’re building out our national footprint.”
All those aspects came together for Everon’s acquisition of Apex, and its owner and CEO Bill Atkinson was impressed with the process. “When I met Mike [Kennedy], we hit it off, but I thought well, this is just one guy in a larger company,” Atkinson says. “But what Mike possesses personally I found across Everon and their leaders – it was a servant leader sort of attitude that I found so attractive. When you are going through an acquisition, there is just this little bit of question about whether you trust these people or not. That quickly faded – for us at least.”
As most integrators know, there are a lot of business brokers and M&A players combing the market for acquisition targets. “It is becoming more and more difficult to find regional players that have built a bigger business and scaled it because those guys are all getting acquired either by PE firms or strategics like us,” Kennedy says.
M&A is proving to be a key cog in the Everon machine. Not only does it help with extending its North American and global reach, but it also is a proven method for adding technicians to companies that would otherwise be starved for help.
“When we look at an acquisition target, one of the items on our checklist is how many technicians it has,” McWilliams says. “We are not that interested in acquiring companies that work only through subcontractors; we obviously want to increase our employee base with great technicians. Dan and I spend a great deal of time talking about technicians, tech turnover, and how to recruit them. When we are evaluating an acquisition, we must understand their technical expertise, how many technicians they have, and their retention rate. It definitely helps.”
Kennedy adds that his strategy is to give each acquired company autonomy; in fact, each company is unique under the Everon umbrella. “From an acquisition standpoint, none of our offices are cookie-cutter – we don’t go in, make an acquisition, and then give them an org chart and tell them they have to sell a certain product,” Kennedy says. “Whatever they’ve done in Idaho is working, so just keep doing it.”
Such a strategy is vital when there is so much competition for successful regional integrators. “You look at interest rate changes, or the political landscape, or the stock market – when any of them change or move, it hasn’t changed anything in our industry at all, it just keeps going upward,” Kennedy says. “Private equity firms are really understanding the business more now, and how recession-proof the recurring revenue piece is. There are a lot of folks looking at our industry who have never played in our market before, so it puts the onus on us to be a little different in our offerings.”
Completing the Circle
Not only is Everon investing in the purchase of other integrators, but it is also in the market for game-changing technology. That came to fruition in March when the company acquired DIGIOP’s video analytics software, and its CEO, Mike Compton, joined Everon as its CTO.
Just this month, the company also announced the opening of the Everon Innovation and Operations Center – known as the iO – in the Dallas area. Designed to be a hub of learning, innovation, and collaboration, it is the new home to Everon’s dedicated monitoring and customer operations center, Innovation Lab, and Solutions Showcase demo area.
In the end, both are just two more steps toward completing the circle.
“We built such a strong culture at ADT Commercial,” McWilliams says. “That same group is still leading the band, but we’re going to do it faster now…and better.”
