Despite the economic turmoil, merger and acquisition activity in the security industry has continued over the last couple of years. However, video surveillance acquisitions have not been at the forefront of these deals.

The remote monitoring market has seen sizable deals, such as the acquisition of Broadview Security by Tyco International in 2010. The deal was worth around $1.9 billion. In the same year, Protection One was acquired by private equity firm GTCR and Monitronics was acquired by Ascent Media Corp in a deal valued at $1.2 billion. The acquired companies were three of the five largest monitoring companies in the North American market in 2010.

Similarly, in the systems integration market; large, high profile merger and acquistion activity has occurred. The recent acquisition of Niscayah by Stanley Black & Decker has combined two of the top ten providers to the US market (in revenue terms). According to a press release from Stanley, the deal was worth $1.2 billion and was completed in September 2011.

Another notable non-video surveillance acquisition is Safran’s acquisition of L-1 Identity Solutions ($1.09 billion value).

However, the video surveillance market has not really seen deals of a similar magnitude. Generally, merger and acquisitions activity has been on a much smaller scale. Most recently, March Networks announced that it had been acquired by Infinova in a deal worth around $90 million. Other notable activity includes Dvtel’s acquisition of video analytics manufacturer ioimage in 2010 and mergers at Panasonic and Samsung to create unified video surveillance businesses.

The only recent exception is UTC Fire & Security’s acquisition of GE Security in 2010. GE Security was a top ten supplier to the video surveillance market in 2009; however, it is doubtful whether the video surveillance business was the main driver in this acquisition with the fire business a key strength of the company’s product portfolio. Consequently, you need to look back to 2007 for the last acquisition of a top ten video surveillance supplier primarily for its video surveillance equipment portfolio, with Schneider Electric’s purchase of Pelco.

IMS Research’s annual report on the global CCTV and video surveillance equipment market estimates that the market was worth over $9 billion in 2010. However, the top 15 video surveillance equipment suppliers only accounted for around 40% of all sales. In addition, the video surveillance industry has continued to enjoy robust growth despite the unfavourable economic climate. IMS Research forecasts that network video surveillance equipment sales will exceed 25% in 2012, despite uncertainty in the Eurozone.

Whilst IMS Research does not believe that the video surveillance industry will see a spate of billion dollar super deals in 2012, it is likely that a greater volume of medium-sized deals will complete in the next 12 months.