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Carlyle seals Korea’s biggest PE buyout since 2008 with $1.93bn Tyco arm deal

3 Mar 2014

security cameraCarlyle’s long-rumoured move for Tyco International’s South Korean security systems unit has been secured after the firm agreed to pay $1.93bn for the asset.

The deal is the largest private equity buyout in terms of dollar value since the onset of the 2008 financial crisis according to Carlyle, which said it expected to close the purchase in the second quarter.

ADT Korea provides about 475,000 small and medium-sized businesses, commercial and residential customers with advanced security systems including central monitoring and video surveillance.

Carlyle was among a string of private equity houses said to be interested in the asset including KKR, Bain Capital and IMM PE.

Bain had partnered with South Korean private equity firm Hahn & Co to bid for the unit, while Standard Chartered’s private equity arm and Affinity Equity Partners were also thought to be considering offers.

Carlyle Asia managing director Sanghyun Lee said, “ADT Korea is a highly stable and profitable business with attractive market positioning, strong brand power and excellent cash flow profile.

“We believe the Korean security services industry is under-penetrated, and growing awareness and needs for safety will anchor significant growth in the future.

“Korea is one of the few countries in Asia that generate stable economic growth along with consistent deal flow of large buyout transactions.

“Carlyle’s investment in ADT Korea once again accentuates our long-standing commitment to Korea since the establishment of Carlyle Korea in 1999.”

Carlyle said equity for the deal would come from Carlyle Asia Partners IV and Carlyle Partners VI.

Carlyle had invested more than $920m of equity in 17 transactions in Korea as of the start of the year.

Those investments include KorAm Bank, Hyundai HCN, EO Technics, Tapex, and Yakjin Trading.

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