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Topsgrup bought a 51 per cent stake in the UK-based Shield Guarding Company, which provides specialised security services to over 350 clients, including Walt Disney, Fujitsu, Nokia and Porsche.
‘'We were losing out on the global tender contracts of these multinationals in India. Shield's clients include some of the biggest brands in the UK. This (stake buy) will also help us grow Shield's business in the UK as we have been doing business with clients such as HSBC for 15 years,'' Rahul Nanda, Global CMD, Topsgrup told Business Standard after announcing the deal in Mumbai. Nanda plans to outsource all the back-end work for Shield, including making uniforms and accounting, to India, and is targeting a saving of Rs 8 crore (1 million pounds) in three years by exploring the synergies. The savings target for the first year is 300,000-40,000 pounds. “The strategic partnership of the two security brands augurs well for the rapidly-growing global security industry, which is estimated to cross the $230 billion mark by 2015,'' said Gerry Paxton, executive chairman of Shield. The UK company had a turnover of Rs 484 crore and profit before tax of Rs 18 crore in 2008-09. Tops Security, the flagship company of the group, is 13.69 per cent owned by ICICI Venture. It is growing at the rate of 50-55 per cent and offers security services, including emergency response. Topsgrup plans to be a $1 billion company in three years and will raise its sales to $10 billion in the next 15 years. ‘'We have a global vision. We want to be in five countries in the next five years. We will soon close a deal to acquire a $300 million company in the US. This acquisition provides a gateway to our global plans,'' said Nanda. ICICI Venture has invested Rs 115 crore in Tops Security, while Future Group increased its existing stake in the company from 4.94 per cent to 7.08 per cent. Stock investor Rakesh Jhunjhunwala owns 10.8 per cent and is also a director on the company's board. The size of the domestic security industry is estimated at Rs 2500 crore, with the unorganised sector accounting for two-thirds of the business. A few weeks back, Topsgrup had acquired the Rs 35 crore Guardwell Detective Services, which offers security services in south India and has clients such as Tatas, Birlas, Reliance, Airtel, HSBC, Standard Chartered and ICICI Bank. |
Source: Business Standard