(Alliance News) - Croma Security Solutions Group PLC on Tuesday said it plans to divest its manned guarding business Croma Vigilant, as its merger with two other divisions is not generating the expected level of sales.
The Hampshire, England-based security services provider said that despite Vigilant securing a number of contract wins in the current financial year, the strategy of combining Vigilant with the Croma Locksmiths Ltd and Croma Security Systems Ltd businesses has not generated the opportunities for cross marketing and cross sales it expected.
Croma Security Solutions said Vigilant's management team has expressed interest in acquiring Vigilant from the group. Vigilant is led by Croma's Executive Director & Vigilant's Operations Director Paul Williamson, and is supported by Executive Chair & Managing Director Sebastian Morley.
Both Morley and Williamson will step down from Croma Security Solutions at the end of the Annual General Meeting being held later today in order to pursue the acquisition.
Looking ahead, Croma Security Solutions said it will refocus its strategy on the development of Croma Locksmiths and Croma Security Systems as margins are high and cash generation remains strong in these businesses. The company added there are good opportunities for profitable growth in these firms.
The group's strategy to acquire locksmith businesses around the country and develop them into security centres was put on a two-year hold due to the pandemic. Croma Security Solutions said it is now seeing multiple opportunities that carry out this strategy as it received direct approaches from other operators in the sector.
Croma Security Solutions added that trading in its recent financial year has continued in line with management expectations. The firm's financial year ends June 30.
Croma Security Solutions shares were up 15% to 64.00 pence on Tuesday morning in London.
By Jaskeet Briah, Alliance News reporter
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Croma Security (CSSG)