SIS Security to raise Rs 450 cr via PE route

SIS Security Services, a leading player in Indian private security industry, is planning to raise $100 million (Rs 450 crore) through private equity (PE) route by December 2010. The funds will be primarily used acquire companies in India, Middle East and Southeast Asia.

“We are been approached my some PE funds and we have mandated NM Rothschild India to manage the fund raising activity,” said Rituraj Sinha, Chief Operating Officer, SIS Security Services.

Private equity fund DE Shaw & Co own 14 per cent equity in the company.

“In 2008, DE Shaw invested in SIS Security and we used that fund to acquire Chubb Security in Australia,” said Sinha.

He refused to share the details of exactly how much DE Shaw invested in the company.

Presently the Sinha family (promoters) holds 80 per cent equity in the company, post the fund raising activity the promoters will hold 75 per cent equity.

Currently, the private security market in India is around Rs 11,000 crore and is expected to grow by 20 to 25 per cent in the next five years, which provides ample scope for companies like SIS Securities to scale up their operations.

“We employ more than 40,000 personnel and have 3,000 corporate customers in 75 cities. Indian security market is quite small when we compare it globally but the scope is huge. In the next two-three years, our focus will be to increase our lines of operations through some strategic acquisitions,” said Sinha.

Talking about the company’s plans to get listed in the stock exchange, Sinha says that it will take a couple of years before they go to the market but it is definitely in their outlook.

The company also wants to grow its facility management business which it started two years ago though a joint venture with Service Master Corporation, a $5 billion American firm.

“Two years ago we stepped into cleaning industry by forming Service master Corporation India. Today, this company is mostly concentrating in the southern India market as there are lot of infrastructure development going on in Bangalore, Chennai and Hyderabad. We hope to grow this company substantially in the next three years,” adds Sinha.

SIS Security clocked revenue of Rs 1,440 crore in 2009-10 and it plans to reach Rs 2,200 by 2012.