IMG’s Debt-Funded Tyco NZ Buy Raises Leverage but Promises Earnings Growth

Strategic Acquisition Strengthens Trans-Tasman Presence

Intelligent Monitoring Group Limited (IMG) has announced its acquisition of Bluesky Holdco Limited, the parent company of Tyco New Zealand and Red Wolf Security, for NZ$45 million (approximately A$40 million). This acquisition marks a significant expansion of IMG’s commercial security and fire services operations in New Zealand, complementing its existing Australian footprint and reinforcing its position as a leading security services provider across Australasia.

Tyco New Zealand, established in 1899, is a well-recognised fire services company with a strong commercial and enterprise customer base. It operates 12 branches with over 300 employees, servicing more than 7,000 sites. The company’s revenue is notably resilient, with 75% derived from recurring service contracts, including inspection, testing, maintenance, and compliance services. Red Wolf Security, a specialist commercial security provider based in Wellington, adds further depth with its expertise in high-security environments and government-grade technology solutions.

Financial Upside and Operational Synergies

The acquisition is expected to be immediately accretive to IMG’s earnings, with an estimated EBITDA contribution of NZ$10.9 million (A$10 million) in FY26. This translates to a 28.3% increase in earnings per share, lifting IMG’s pro forma EBITDA guidance to between $53 million and $57 million for the fiscal year. The deal will be funded through IMG’s existing balance sheet capacity, drawing on its NAB facility, and is projected to maintain net debt to EBITDA at a conservative 1.9x, comfortably within the company’s targeted leverage range.

Beyond the financial metrics, the acquisition aligns closely with IMG’s strategic growth objectives. It enhances IMG’s technology capabilities by integrating advanced fire lifecycle services and government-grade security technologies. The combined customer base, exceeding 210,000 monitored and serviced sites across Australia and New Zealand, offers substantial cross-selling opportunities and operational scale. IMG’s workforce will expand to over 900 full-time employees, bolstering its specialist expertise and capacity for long-term growth.

Market Position and Growth Prospects

IMG’s acquisition of Bluesky Holdco solidifies its leadership in a fragmented Australasian security market. The company’s focus on AI-enabled monitoring and video-first security solutions positions it well to capture growth in both residential and commercial segments. With a recurring revenue base that now exceeds $16 million per month, IMG benefits from stable cash flows and strong customer retention, underpinned by long-term contracts and regulatory-driven demand for fire and security services.

Investors will note IMG’s disciplined approach to M&A, targeting acquisitions that are immediately value accretive and integration ready. The company’s commitment to maintaining robust capital markets metrics and operational leverage suggests a balanced growth trajectory that leverages both organic initiatives and strategic acquisitions.