Croma Security Solutions buys Southern Security Services for £0.55 million
Croma Security Solutions Group (AIM: CSSG) has completed a bolt-on acquisition of Southern Security Services Limited (SSS), a specialist electronic security and locksmith business based in Poole, Dorset. The deal totals £0.55 million, funded entirely from Croma’s existing cash reserves.
It’s a classic Croma play: acquire a well-regarded local operator, fold in its engineers and customer relationships, and extend the Group’s regional footprint. This one also comes with a useful freehold property, which helps underpin value.
What exactly Croma is getting in Dorset
SSS is an established provider of electronic security solutions, covering locking systems and safes, intruder alarms, CCTV, access control, and automated doors and gates. Founded in 1983, it focuses mainly on commercial customers, including local authorities and healthcare operators. The reputation angle matters here – premium advice and delivery in security win repeat work.
There are 12 locally based staff joining Croma as part of the acquisition, adding experienced engineering and advisory capacity. Crucially, SSS operates in close proximity to a number of Croma’s existing clients, which should make cross-selling and resource sharing far more immediate.
Key deal numbers and business metrics
| Total consideration | £0.55 million (subject to cash/debt/working capital adjustments) |
| Initial payment | £0.46 million |
| Deferred/earn-out | £0.09 million over 12 months |
| Included freehold property | £0.4 million (single trading outlet) |
| SSS revenue (year to 31 Dec 2025) | £1.04 million |
| SSS EBITDA (year to 31 Dec 2025) | £0.13 million |
| SSS net asset value | £0.43 million |
| Employees joining | 12 |
| Funding source | Existing cash reserves |
Price, multiples and what the deal implies
The structure is straightforward: £0.46 million upfront with £0.09 million deferred and subject to earn-out targets over 12 months. No new shares, no fresh debt – just cash.
- Headline price-to-sales: roughly 0.53x (£0.55 million on £1.04 million revenue).
- Headline EV/EBITDA: roughly 4.2x (£0.55 million on £0.13 million EBITDA).
- Price vs book: about 1.28x (£0.55 million vs £0.43 million NAV), implying c.£0.12 million of goodwill over net assets.
Important caveat: the announcement says consideration is subject to completion adjustments. These simple multiples are based on the headline price and trailing numbers, so the true figures could shift slightly. Still, they suggest a sensibly priced bolt-on, with a large portion of value supported by bricks and mortar.
Strategic fit: local bolt-on powering a national network
Croma’s strategy is to build a national network of modern security centres by acquiring traditional locksmith and electronic security businesses, then upgrading their offer and integrating them into group systems. The Group currently has 17 security centres and over 95 employees, and it has been adding new businesses since selling its man-guarding arm, Vigilant, for £6.5 million in 2023.
SSS is highly complementary. It operates near existing Croma clients, the teams know each other, and the work profile – electronic security and complex access systems – mirrors projects Croma is already delivering elsewhere. That reduces integration risk and should accelerate cross-selling.
Why this matters for shareholders
Three quick positives stand out:
- Capital discipline: funded from cash reserves, so no dilution and no new leverage.
- Asset-backed: the transaction includes a £0.4 million freehold, which helps to anchor downside risk.
- Capability boost: 12 experienced engineers and advisors slot into Croma’s delivery engine in a region with existing Group demand.
The earn-out is modest at £0.09 million and runs only 12 months, but it still aligns incentives through the transition. The founder, Pierre Grandjean, stays for at least a year to bed in the business, with the option to continue by mutual agreement – another helpful de-risker.
What management said – and why it matters
CEO Roberto Fiorentino flagged “immediate opportunities for synergy through the integration of SSS within our operations” and called it a “strong strategic fit.” In plain English: the teams can share projects right away, and utilisation should improve.
SSS’s Managing Director, Pierre Grandjean, highlighted alignment with Croma’s existing work in other regions, plus the chance to scale up delivery of larger programmes. That’s the crux of the thesis – use Croma’s broader platform to win and execute bigger jobs locally.
Jargon buster: quick definitions
- EBITDA: earnings before interest, tax, depreciation and amortisation – a proxy for operating cash earnings.
- Earn-out: a deferred payment contingent on performance after completion, used to align incentives.
- Net asset value (NAV): assets minus liabilities on the balance sheet.
- Freehold: outright property ownership, as opposed to leasehold.
Risks and execution checklist
- Integration: capturing the “immediate” synergies requires tight scheduling and shared systems. Watch for updates on project sharing and margin impact.
- Retention: keeping engineers and key customer relationships through and beyond the 12-month earn-out is vital.
- Pipeline conversion: Croma notes a strong acquisition pipeline across locksmith and security centres. Discipline on price and fit remains key.
- Working capital: the consideration is subject to completion adjustments for cash, debt and working capital – a standard but watchable detail.
My take: a tidy, sensibly priced bolt-on
This is the kind of deal Croma does well: locally relevant, immediately accretive to capability, and bought at a reasonable multiple with property underpin. The proximity to existing clients and prior familiarity with SSS should shorten the integration curve.
On balance, it reads positively. It won’t transform the Group overnight – SSS is £1.04 million revenue and £0.13 million EBITDA – but as part of a repeatable roll-out, it fits the playbook. The real test will be visible cross-selling, engineer utilisation improvements, and steady execution on the acquisition pipeline disclosed in the notes to editors.
What to watch next from Croma
- Integration milestones at SSS – resource sharing, project wins and customer retention.
- Evidence of larger programme deliveries in the region, leveraging the combined teams.
- Further acquisitions within the national network strategy, consistent with today’s pricing discipline.
