Checkpoint Systems, Inc., manufacturer and marketer of identification, tracking, security and merchandising solutions for the retail industry and its supply chain, announced its acquisition of the S3 business from Alpha Security Products, based in North Carolina, US. The all-cash transaction is valued at approximately $142 million subject to post-closing working capital adjustments, plus additional performance-based consideration of $8 million if certain financial performance measures are met. The acquisition is expected to be accretive by several cents to Checkpoint’s earnings per share in 2008.
The Alpha S3 product portfolio comprises security solutions designed to protect high-theft merchandise in an open-display retail environment. These items are particularly vulnerable to the growing problem of organised retail theft (ORT), which costs the US retail industry an estimated $30 to $37 billion per year. The product portfolio combines well with Checkpoint’s leading source-tagging programme. While the latter targets high-volume, mid- and high-risk items, the Alpha line of secure merchandising solutions targets the most critical high-theft items.
New Jersey-based Checkpoint has acquired all of the assets associated with Alpha’s S3 business, including the Alpha brand, approximately 150 employees, and its manufacturing facility in Ohio. For the full year 2007, Alpha’s S3 business is expected to generate approximately $65 million in revenue and approximately $16 to $17 million of EBITDA. Alpha Security Products will be renamed InVue Security Products.
– Mumbai Bureau
