Carlyle to Buy Tyco's South Korea Security Business

By Michael Calia 

The Carlyle Group said Monday it had agreed to acquire Tyco International Ltd.'s South Korean security business for $1.93 billion in cash.

The Wall Street Journal had reported last week that the two companies were in late-stage talks over the unit.

Carlyle called the deal the largest private equity buyout deal in U.S. dollar value in Korea since 2008, representing a big step up in the firm's recent interest in South Korea. Through Dec. 31, Carlyle said it had invested more than $920 million in equity in 17 transactions in the country.

Tyco, due to land $1.85 billion in net cash proceeds from the deal, said the deal would have a five-cent impact on its per-share earnings from continuing operations in the fiscal second quarter. The company now projects a range of 39 cents to 41 cents, down from its previous range of 44 cents to 46 cents.

The South Korean business, called ADT Korea, provides security services to about 475,000 commercial and residential customers, and it employs about 7,500 people. Tyco first bought a 68.5% stake in the company in 1999 and then delisted it from Korea's Kosdaq market after acquiring the remainder later that year.

With the latest move, Tyco sharpened its focus on its core business dealing with safety equipment as well as fire-suppression systems for commercial buildings. In 2012, Tyco spun off its North American security business to create ADT Corp. It also split off its pipe-and-valve business, then merged it with Pentair Inc.

Carlyle, meanwhile, is coming off a successful fourth quarter, in which the firm's results exceeded expectations. It had been competing for the Tyco business with several other large U.S. private-equity firms, according to a previous Wall Street Journal report.

Write to Michael Calia at [e-mail]

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