Swedish security company Securitas and Burns International Services Corporation from the US yesterday signed a definitive merger agreement for Securitas to acquire Burns for SEK 4.1 billion (£297m). The new group is expected to have combined annual sales of about SEK 48 billion (£3.5bn) and will have about 210,000 employees, with operations in more than 30 countries.

Burns, founded in 1909, is the second largest guarding company in the US. The company has 58,000 employees across the Americas and Europe. The company is active in permanent and mobile guarding services, alarm monitoring and security consulting and investigation. Burns' sales this year are expected to reach about $1.5bn (£1bn).

Thomas Berglund

The transaction will be a cash tender offer followed by a cash merger to acquire any shares not previously tendered. As a result of the merger, Burns will become an indirectly wholly owned subsidiary of Securitas. The transaction has been recommended by the Boards of both companies. Securitas expects to commence its cash tender offer during next week.

Thomas Berglund, President and CEO of Securitas commented: "Since summer 1999, our American guarding operations have been reorganised with a clear focus on local responsibility for growth and profitability. The acquisition of Burns will give us an excellent position from which to lead the development of the American security market."

Securitas also announced their first-half results yesterday. The company’s pre-tax profit rose 27% to SEK 252m (£38m) after the first half of this year.

Anna Lagerkvist