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Certis' Aussie buy aims to conquer security market down under
LESS than half a year after his family business was snapped up, Thomas "Tom" Roche holds what he calls "ambitious growth targets" for Australian security services firm SNP Security.
These goals include leapfrogging the competition, to go from third-largest player to market leader in five to seven years, and snagging contracts for a 50 per cent to 60 per cent share of the aviation security market, a historical business niche for SNP.
One reason that Mr Roche is feeling plucky could be the company's new backer: Temasek-owned Certis group, which bought SNP for an undisclosed sum this year.
SNP is now slated for integration with Certis' other Australian security firm - Business Risks International Group Holdings (BRI), acquired in 2016 - with Mr Roche as country managing director. Regulatory approval to operate as a single unit is pending.
"SNP grew quite rapidly over many years as a private business, so now with the muscle that Certis brings to the table, the financial investment that they bring to the table, I think we'll fare really well," Mr Roche told The Business Times in Sydney.
SNP has built up a footprint in aviation, with seven Australian international and regional airports under contract, including the continent's busiest - Sydney Airport. Its most recent win was for passenger and baggage screening at New South Wales state's Dubbo City Regional Airport.
"Aviation is a key area, and with the recent changes in regulations, there's a huge focus in relation to the aviation environment, both for passenger screening and for freight screening," said Mr Roche, who dubbed the sector a key growth area.
But he also called Certis' Australian contracts a diversified mix, as protective services now outweigh the aviation operations. Industries in his cross-hairs include security for land transport, logistics, critical infrastructure installations and commercial high-rises, with organisations such as Sydney Trains already clients.
Mr Roche added that the Australian units are also looking at expanding into retail, tapping the group's experience with Singapore clients such as AsiaMalls and CapitaLand Malls.
"We do some retail but not very much. No brand names - we're not doing any major Westfields or the like," he said. "On the back of Certis' work in Singapore shopping centres, yes, we are considering it."
But there are also contracts that Mr Roche was adamant that Certis will not touch in Australia, citing strategic aims and concerns about reputation.
"We're very much about looking after the high-end corporate market," he said, on the decision to steer clear of pubs and hotels. "We want to be seen with high-profile people doing specialised functions, and not dealing with people who've had too much to drink on a Saturday night."
Mr Roche also ruled out prison and immigrant detention contracts, saying: "There's been a lot of bad press around those detention centres of late, there's a contributing number of reasons why that's the case."
He did not mention any firm by name, but 9,000-strong regional player Wilson Security once drew opprobrium for its role as a sub-contractor at Australia's offshore detention facilities, which house migrant hopefuls such as asylum seekers who arrive by boat.
Group chief executive Paul Chong said in an earlier BT interview that Certis is "thinking very hard in Australia" about prison-related work, "because we know of a service provider that tried and had very bad press from it".
But Mr Roche was keen to possibly draw on lessons from the Certis Cisco auxiliary police force in Singapore, even though there is no statutory equivalent in the Australian market.
"You've got G4S doing private policing in the United Kingdom," he said, referring to the British-based multinational security company, which was hired in 2012 to run police operations in Lincolnshire county. "If there's the opportunity some time in Australia, it might be looked at. Certainly, with Certis' long history working as an auxiliary police force, that puts us in a strong position."
SNP and BRI clocked a combined full-year revenue of A$350 million (S$346.5 million), and have some 3,000 full-time employees altogether.
While Certis would not disclose how much revenue comes from Down Under, its latest full-year takings stood at S$1.2 billion, with more than one-fifth contributed by its overseas businesses. That amount does not include SNP, as the sale was completed after the financial year's close.
Australia's private security market is led by Wilson Security, part of Hong Kong-based Wilson Group that also owns Wilson Parking. Between Wilson and SNP is 6,000-strong MSS Security, which was bought by India-listed SIS Group in 2008.
But both their leading positions won't last for long, if Mr Roche has his way, as he and his team could pull ahead of the pack within the decade, under Certis. He said: "Companies need to reinvent themselves, and I think there is a lot of complacency in the Australian market."