World’s biggest private security group puts multibillion-dollar IPO on hold

The chief executive of Allied Universal has put the company’s multibillion-dollar public listing on hold as the world’s largest private security group tackles hiring problems and rides out the turmoil in markets.

“The last 10 to 12 months have been really choppy waters for public markets, so we’re very comfortable just continuing to remain private,” said chief executive Steve Jones.

Allied, the world’s biggest employer of private security guards employing 800,000 people, has been hit by recruitment problems in a tight labour market and rate rises that have damped the mood for listings in the US.

The crisis engulfing the banking sector has also compounded already challenging conditions for fundraising, creating greater uncertainty in the markets and the economy.

Jones had previously said a US listing of the world’s seventh largest employer and North America’s third biggest in an expected multibillion-dollar transaction was possible by May 2024, but “that timeline has been paused”.

Stephen Rawlinson, analyst at Applied Value, said Allied Universal’s enterprise value, including debt, could be between $15bn and $17bn. “It partly depends on whether Allied Universal can argue that it has market power as the global leader and is therefore worth a premium,” he said.

Jones said labour shortages had eased, although it was still a tight market following the pandemic, which created “the biggest challenge we’ve faced really in my 25-year career” for recruiting.

He said the US government’s stimulus programmes rolled out at the height of the pandemic hampered the company’s ability to attract and hold on to workers.

“We’ve had low unemployment rates in the past, but we really haven’t faced a situation where people were provided with some sort of government subsidies to be able not to work,” he said.

However, he said he was “seeing conditions begin [to] improve in terms of new applicant flow and new hires”.

Referring to the delay in the IPO, he said: “There are many factors for us to consider . . . including general economic uncertainty, fear of recession and significant increases in interest rates over the past year.”

Allied acquired UK-listed security group G4S in 2021 during a spree of acquisitions. The deal was backed by private equity firm Warburg Pincus and Canadian pension fund Caisse de dépôt et placement du Québec.