Honeywell has agreed to acquire privately held US Digital Designs, Inc., a Tempe, Arizona -based company, for a purchase multiple of around14x EBITDA in an all-cash transaction. The company delivers alerting and dispatch communications solutions, which enhance first responders’ efficacy and enable faster emergency response times.
According to the company, US Digital Designs’ EBITDA margins are accretive to Honeywell, and Honeywell is expected to achieve a return on investment of greater than 25% by the fifth year that US Digital Designs is part of Honeywell.
The acquisition will be integrated into Honeywell’s Fire and Connected Life Safety systems business and will expand Honeywell’s line of solutions for public safety communications, providing first responders with better situational awareness of building emergencies and improved life safety. When combined with Honeywell’s solutions, US Digital Designs’ offerings will securely transmit detailed data about the emergency, such as the type of hazard, severity, and location within the impacted building, all before first responders even arrive onsite.
The existing communications infrastructure between fire stations and emergency centres often uses legacy, manual technology, which slows response times and affects the accuracy of transmitted information. In contrast, solutions from US Digital Designs instantaneously connect dispatch centres to fire stations, improving both the quality of the information shared and the time it takes for first responders to arrive at an emergency. It is estimated that in the coming years, aligned to pending federal legislation to improve the 911 system, several billions will be invested in the United States alone to upgrade legacy alarm infrastructure to provide faster, more precise alarm alerting to first responders.
“The future of public safety relies on technology. We are integrating intelligence throughout the fire alarm transmission process – from the fire panel to the first responders – and providing uninterrupted communications to first responders,” said Doug Wright, president and chief executive officer, Honeywell Building Technologies. “Integrating US Digital Designs’ fire station alerting capabilities with Honeywell’s Connected Life Safety Services will allow us to eliminate manual processes and significantly reduce response time. Helping first responders arrive faster on site means potentially saving more lives and providing a higher level of asset protection.”
US Digital Designs’ suite of hardware and software solutions, which includes dispatch communication aids and mobile alerting applications, provides situational awareness and helps reduce response times. US Digital Designs also offers solutions that awaken first responders with soft-start LED lighting and audio alerts that are less disruptive.
The offerings complement Honeywell’s suite of solutions that help its customers meet their environmental, social and governance (ESG) goals, including improving safety for first responders.
“We are pleased to join the Honeywell team and support its efforts to add more automation and digitisation to the public safety communications process. Reducing response times means we can protect more people, buildings and their assets,” said Todd Smith, president and chief electrical engineer, US Digital Designs.
“Honeywell’s scale, global reach and commercial relationships will enable even more fire stations to access our solutions, helping to create safer communities,” said Dominic Magnoni, vice president, chief mechanical engineer and chief operating officer, US Digital Designs.
With this acquisition, Honeywell will further expand its public safety offerings designed to improve the safety of first responders and building occupants. These offerings include Fiplex bi-directional amplifiers (BDAs) that provide continuous and critical in-building radio coverage. Honeywell acquired a majority stake in Fiplex Communications, Inc., in March 2021.