14 Dec ILUS completes another fire safety acquisition with control of UAE company
ILUS International Inc. has signed a Share Purchase Agreement to acquire 51% control of UAE company AL Shola Al Modea Safety and Security LLC (ASSS).
In a strategic move by ILUS, the company has acquired the majority stake of ASSS to ramp up its Middle Eastern fire safety expansion plans. This involves ASSS working closely alongside BCD Fire, which was acquired by ILUS in April 2021, to dominate the United Arab Emirates (UAE) fire safety sector through the leveraging of licensing, certifications, manpower, experience, and relationships. The acquisition will also speed up ILUS’ focused expansion into the lucrative Saudi Arabian market as well as the rest of the Gulf region.
Capitalising on the experience and contacts of its then parent company, Al Shola Gas, which was founded in 1990, ASSS was established as a separate entity in 2008. As a well renowned primary contractor for many of the region’s most prestigious property developments, the company specialises in the design, installation, commissioning, and maintenance of fire alarm, fire protection and security systems. ASSS holds the highest level of licensing and certifications to operate as the main contractor for commercial, residential, and industrial facilities across the United Arab Emirates.
With the UAE’s accelerating economic growth in 2022 and even higher growth expected in 2023, the property market in the region has been on an upward trajectory, resulting in high demand for fire safety and security contractors and short supply of those with the required licensing and certifications. ASSS has a full order book for 2023 and is currently expanding its resources to take on additional contracts. As a main contractor, the company will correspond closely with BCD Fire, who operates primarily as a sub-contractor in the region. Together, the companies can secure larger contracts and reduce project completion timeframes. ASSS will focus on installation contracts and larger projects across the region, utilising additional manpower from BCD Fire when needed, whilst BCD Fire will focus on maintenance contracts and fire protection equipment distribution, utilising the technical design and management experience of ASSS where required. The cooperation between the two companies will result in a substantial momentum shift for ILUS’ fire safety growth plans across the Middle East, including in Saudi Arabia, where ILUS has been negotiating several large contracts, all requiring the additional manpower and experience provided by ASSS. The Managing Director of ASSS, Sanjeeb Safir, who has been involved in the company since its inception and led its growth for many years, will take on the role of General Manager for both ASSS and BCD Fire, from January 2023.
The deep technical design and installation experience within the ASSS ranks also provides a strong platform for ILUS to roll out its fixed water mist suppression systems in the region, with ILUS planning to have both of its fixed water mist suppression systems certified to LPCB and NFPA standards during the early part of 2023. Bringing ASSS with its strong management into the ILUS portfolio represents a vital strategic shift for ILUS in the Middle East, allowing the ILUS fire safety strategy to be driven forward by an experienced and passionate local management team.
Although ASSS remained profitable throughout the COVID-19 pandemic, the company is now experiencing rapid growth and based on its current order book and sales pipeline, it is expected to achieve more than $4.5 million in 2023. Further additional growth is expected through expansion in Saudi Arabia and from the collaboration with BCD Fire. For 51% of the shares of the company, ILUS agreed to pay $714,000 in several tranches to the Seller provided that forecasted revenue and EBITDA projections are met.
John-Paul Backwell, ILUS Managing Director said: “This is an important strategic acquisition for ILUS in the Middle East and it also signifies the significant progress we are making towards our global fire safety rollout. There is so much more going on behind the scenes when it comes to product development, project management of current contracts and business development for new contracts, therefore this deal is important for strengthening our management and resources in the region to ensure that we reach our milestones and accelerate our growth in the Gulf region.
“I am looking forward to working closely with ASSS, together with BCD Fire, to capitalise on the plethora of huge opportunities in the UAE and Saudi Arabia. With further deals and important strategic moves lined up, we expect to close out 2022 strongly with further announcements before starting 2023 with a flourish leading up to our second Annual Shareholder Meeting on January the 27th.”