ADT Officially Files for $1.5B IPO
ADT files with SEC seeking to raise $100 million to $1.5 billion in IPO that values the security giant at $15 billion.
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ADT Company Info
After months of speculation, ADT has officially filed with the Securities and Exchange Commission for an Initial Public Offering (IPO), and will seek to raise $1.5 billion in capital according to one analyst. The residential smart home / security giant values the company at $15 billion. The company will be listed on the NYSE under the ticker symbol "ADT".
In the SEC S1 filing, the company lists it is seeking $100 million, but according to Bloomberg, that figure is a placeholder and likely to escalate. At least one analyst believes the company will seek $1.5 billion. ADT lists $10.1 billion in debt. For 2017, ADT generated $3.2 billion in revenue but reported a net loss of $295 million.
ADT was previously a public company before being purchased by Apollo Global Management in 2016 for $12.3 billion. Apollo also owns Protection One. ADT is led by CEO Tim Whall, who was formerly Protection One's CEO.
The company, which is the No. 3 company in the CE Pro 100, has 7.2 million residential and commercial customers in the U.S. and Canada, according to the filing. More than 90 percent of its revenue comes from recurring monthly revenue (RMR), which has increased in recent years since the introduction of ADT Pulse, a smart home offering that melds security, lighting, and climate control.
In 2016, ADT reported $501.7 million in multi-subsystem smart-home revenue, which was a remarkable 260 percent growth. Meanwhile, the company’s number of multi-subsystem installations grew 64 percent to 788,250, up from 482,000 in 2015. It ended 2016 with more than 2 million ADT Pulse customers.
Morgan Stanley and Goldman Sachs Group Inc. are leading the IPO. One analyst believes the IPO will be positioned as an Internet of Things (IoT) play in the market, which will make it attractive to investors. Interestingly, that same analyst speculates that ADT could suffer under the new Trump tax plan, which limits a company's interest deductions to 30 percent of EBITDA. Last year, ADT's interest on debut amounted to about 35 percent of net earnings.
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Jason has covered low-voltage electronics as an editor since 1990. He joined EH Publishing in 2000, and before that served as publisher and editor of Security Sales, a leading magazine for the security industry. He served as chairman of the Security Industry Association’s Education Committee from 2000-2004 and sat on the board of that association from 1998-2002. He is also a former board member of the Alarm Industry Research and Educational Foundation. He is currently a member of the CEDIA Education Action Team for Electronic Systems Business. Jason graduated from the University of Southern California. Have a suggestion or a topic you want to read more about? Email Jason at firstname.lastname@example.org
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