Home security provider Scout Security (ASX: SCT) has partnered with US giant Stanley Black & Decker (NYSE: SWK) to further promote its proprietary home security platform and hardware suite.
The deal helped to push Scout shares up 20% to A$0.21 per share by mid-afternoon with Scout saying that the tie-up presented “numerous near-term and long-term opportunities in security.”
Meanwhile, Stanley shares finished trading up around 3% at yesterday’s close in New York at US$149.47 per share with today’s news likely to be priced in upon US market open.
The deal could be a potential money-spinner for Scout given the scope of Stanley’s operations, with the company saying it expects its newly-forged partnership to make a material contribution to its bottom line “starting in the March 2019 quarter.”
As part of the agreement, Stanley will pay Scout a fee of A$408,000 for the right to deploy the Scout software platform and hardware suite across its brands and security business units around the world.
On a global scale, Stanley is the currently the second largest provider of security services and the world’s largest provider of tools and storage that rakes in around US$13 billion in revenue every year.
According to the company, it protects over 500,000 buildings around the world and manages a powerful portfolio of trusted brands in residential and commercial security, complemented by market-leading technologies in tools, healthcare and industrial applications.
Its recent focus on security has led to Stanley becoming one of the world’s most prominent “electronic security” companies with future innovation a key aspect to winning greater market share from its peers.
The deal with Scout represents a means for Stanley to further develop its own product offering and utilise Scout’s innovations as part of its own product line up.
“We have been impressed with the technology and team at Scout and believe that a strong partnership with Scout can help us grow our position as a global provider of Security Services,” said Joe McCormac, president of Convergent Security Solutions at Stanley.
In the security industry, Stanley operates several business units and offers a range of solutions for residential, commercial, alarm dealer and monitoring centre customers.
Meanwhile, Scout is a wireless home security company that has developed a “do-it-yourself software platform” that can facilitate high-quality security measures for consumers.
Scout’s headline product is the Scout Alarm – a self-installed, wireless home security system which makes security “more modern, open and affordable”.
In 2016, the Scout system was chosen by CNet as one of the Best Smart Home Devices of the year.
Scout’s design-centric offering gives users complete flexibility around connected home security, allowing the system to integrate with other best-in-class internet of things devices and offering flexible monitoring options.
“Our teams have spent a fair amount of time together at this point and both companies share a common vision for where the security space is headed. Each of the security verticals that Stanley operates within is an area that Scout has shown interest in over the years with various offerings,” said Dan Roberts, co-founder and chief executive officer of Scout Security.
“Now, we have the chance to take that interest and vision to the next level by joining forces. I’m incredibly excited to see what the future holds for Scout and Stanley,” added Mr Roberts.