Security Solutions M&A Update – January 2026

Public Safety Gaps, Classroom Protection Concerns Support Security Solutions M&A

Security Solutions merger and acquisition (M&A) activity gained momentum in 2025 after several years of stagnation, invigorated by the injection of new technologies into the sector, continued threats to educational institutions, intense political focus on public safety, and staffing difficulties within police departments. The adoption of artificial intelligence (AI) across the Physical Security space has tightened end market and M&A competition, propping up both new offerings and modernized legacy solutions as attractive acquisition targets. School districts across the U.S. continued to strengthen facilities as the front line of defense against classroom-targeted shootings, with budget-constrained districts supported by state and federal government school safety grants. These new funding sources initiated a flood of spending on traditional physical security products, armed guards, and advanced surveillance and access control systems. Additionally, political discourse that focused on public safety initiatives throughout 2025 renewed end market demand for security products and services. Critical gaps in police staffing have also provided new Public sector opportunities for the Uniformed Guard segment. Together, these factors are anticipated to further strengthen recent gains in Security Solutions M&A deal volume.

The combination of people, process, and technology enables better outcomes and more efficient resource utilization. Technology is a force multiplier increasing the productivity of existing personnel and enhancing safety. These win-win operational outcomes also create attractive recurring revenue opportunities coveted by investors.

Tom McConnellManaging Director, Capstone Partners

Private Equity Add-Ons, Private Company Growth Strategies Dominate Security Solutions M&A

Private equity (PE) add-on strategies and intense inorganic growth strategies among private strategics introduced significant consolidation to the sector, pushing Security Solutions M&A to new heights in 2025. Sector M&A activity surged 24.1% year-over-year (YOY) in 2025 to 242 deals. PE add-on transactions accounted for the lion’s share (45.9%) of sector dealmaking, adding 14 deals for a 14.4% YOY jump in volume. Repeat acquirers in this buyer cohort included Gemspring Capital-backed Security Franchisors and Altas Partners-backed Pye-Barker Fire & Safety. These companies consolidated smaller service providers to rapidly expand portfolio offerings while rolling up competitors to establish geographic dominance. Notably, Pye-Barker acquired a total of 41 companies in 2025 in pursuit of a comprehensive service offering across fire, life safety, security, and monitoring. PE platform transactions increased 33.3% YOY to 20 deals, further crowding the Fire & Life Safety space as financial buyers rush to establish a presence in the rapidly expanding segment. These newly established platforms are expected to further propel PE add-on activity into 2026 as they enter the pool of sponsor-backed buyers. Private strategic M&A expanded 36.1% YOY, representing 34.3% of deal volume in 2025. Companies including Allied Universal and MES Service Company used their significant scale and resources to consolidate their respective markets, engaging in multiple bolt-on transactions in 2025. Public-led dealmaking expanded by 27.3% YOY in 2025 but only accounted for 11.6% of overall sector deal volume. After years of subdued activity, the rebound in public strategic M&A was fueled by acquisitions of Fire & Life Safety segment targets—a highly competitive space for roll-ups given surging data center safety needs. The competitive M&A environment has supported healthy valuations within the Security Solutions sector. Deal multiples have displayed relative health and resilience since 2021, averaging a robust EV/EBITDA multiple of 11.8x and EV/Revenue multiple of 2.2x over the five-year period. Private strategics and PE-backed platforms are expected to continue vying for geographic control, while heightened competition for quality assets is likely to drive valuations upwards.

The Fire & Life Safety and Uniformed Guard segments received significant M&A attention in 2025. Deal activity in the Fire & Life Safety segment jumped 66.7% YOY in 2025 to 125 transactions. The rapid construction of data centers to fuel the power demands of AI significantly expanded the total addressable market of the Fire & Life Safety segment. Concerns around heat, pollutant exposure, and machinery hazards require the deployment of complex safety systems. For the Uniformed Guard segment, recent staffing difficulties faced by law enforcement agencies served as catalysts for end market demand, leading to a nine deal (150% YOY) jump in 2025. Lucrative, recurring government contracts attracted acquirers to the segment in 2025, reversing a multi-year decrease in Uniformed Guard segment deal volume. Mounting pressure from federal authorities urging municipalities across the country to take a tougher stance on crime—or face federal intervention—is likely to sustain investment in the Uniformed Guard segment as well as the adjacent Tactical Products market. Departments have sought innovative, technology-driven solutions to extend the utility and reach of existing personnel. Capstone has witnessed the strong demand for public safety technology and services first-hand, advising Extra Duty Solutions (EDS)—a leading provider of off-duty program administration services and scheduling software solutions to law enforcement and public safety agencies—on a significant growth equity investment from PE firm Bregal Sagemount in June 2025. Terms of the deal are confidential. The investment will support EDS’s strategic growth initiatives focused on enhancing its technology offerings, expanding its geographic footprint, and growing its portfolio of solutions for law enforcement and public safety agencies.

Campus security concerns contributed to M&A activity across segments in 2025 amid the continuing threat of mass shootings and classroom violence. Typical safety concerns such as the installation and maintenance of fire safety systems continued to drive M&A demand for manufacturers and system integrators, particularly those diversified across end markets. Best practices for managing and monitoring the entry and exit of individuals within school facilities uplifted M&A activity within the Access Control segment, attracting deals such as CCL Industries’ (TSX:CCL.B) acquisition of secure identification badging vendor Idesco for an enterprise value of $19 million, equivalent to 0.9x EV/Revenue (October 2025). Future Security Solutions M&A will continue to be characterized by school safety initiatives, with technology and innovation set to redefine the competitive landscape.

Police Staffing Crisis Drives Municipal Demand for Uniformed Security Personnel Services

U.S. law enforcement agencies have faced a convergence of issues over recent years, introducing significant risk to the safety of officers and communities alike. These dynamics have incentivized technology investments while demanding reliance upon uniformed guard services, driving a subsequent renewal in segment M&A activity. Yearslong analysis of officer fatalities has demonstrated an upward trend in the rates of violence faced while on the job. The number of law enforcement officers killed in the line of duty increased 6.4% in 2024 to 64 deaths, 20.7% above the two-decade average from 2005 to 2024, according to a Federal Bureau of Investigation (FBI) special report.¹ This rising threat landscape has been exacerbated by retention and recruitment difficulties experienced nationwide, with the average department operating at 91% of authorized staffing levels, according to the International Association of Chiefs of Police’s (IACP) 2024 State of Recruitment & Retention survey.² These chronic staffing shortages have resulted in tangible consequences for citizens. The San Diego Police Department has seen increasingly poor response times, operating with a 10% vacancy rate as of November 2025, according to an article from CBS8.³ Priority One calls—encompassing crimes including domestic violence, bomb threats, and missing children—faced average wait times of nearly 35 minutes in 2024 and 2025, while calls to address robberies, traffic collisions, and welfare checks were met with response times of up to 167 minutes.

Public safety agencies have found partial relief through the adoption and integration of maturing security technologies. Flock Safety—the developer of a suite of AI-enabled security products including license plate readers, video cameras, and gunshot detectors—experienced a 70% YOY increase in recurring revenue in the first quarter of 2025, according to the company’s blog.⁴ Flock has expanded to a post-money valuation of $7.5 billion since its founding in 2017, raising just shy of $1 billion from investors including Andreessen Horowitz, Axon (Nasdaq:AXON), and Y Combinator, according to PitchBook.⁵ These technologies enable departments to respond faster to emergencies, passively conduct traffic operations, and extend the reach of strained personnel. In addition to delivering enhanced frontline capabilities, technology has also enabled departments to update antiquated back-office operations. Software modernization solutions help streamline the deployment of assets, introducing efficiency to day-to-day tasks while allowing agencies to reallocate manpower to other core functions. These service providers and solution developers have attracted the attention of financial buyers due to strong end market demand, recurring government contracting opportunities, and valuable IP.

To ease the pressure placed upon strained police resources, municipalities have expanded their relationships with private security firms to bolster the ranks of public safety agencies. Uniformed guard contracts have aided in supplementing the number of personnel on duty, allowing departments to direct sworn officers toward priority calls while security guards focus on lower-level patrol duties. Of note, Oakland, CA has supplemented its police force to the tune of nearly $30 million since 2018, according to an article from the San Francisco Chronicle.⁶ The city has faced severe police staffing and budgetary issues in recent years, relying upon Department of Justice (DOJ) grants in an attempt to stem a net outflow of officers from the Oakland Police Department. An additional $45 million city contract for private security services over the next three to five years is on the table, according to the San Francisco Chronicle article. Attracted by these high-dollar opportunities, private strategics renewed bolt-on strategies while PE firms initiated increased numbers of add-on transactions within the segment in 2025. Several Uniformed Guard segment transactions are highlighted below.

• Sentinel Holdings Acquires OPSEC Specialized Protection (September 2025, Undisclosed) – Sentinel Holdings (OTCPK:SNTL) acquired OPSEC Specialized Protection in September 2025 for an undisclosed sum. OPSEC provides a comprehensive range of security personnel services through its three core business divisions: Patrol, Security/Bike, and Executive Protection. The company offers both armed and unarmed guards to banks, construction sites, shopping centers, apartment complexes, mobile home parks, homeowners associations, entertainment venues, and private individuals. OPSEC also runs AV Security Academy, a program offering private security training and lessons to students. In addition to bolstering its existing uniformed guard offerings, Sentinel will take over a major contract with a leading fast-food chain in California and numerous smaller contracts with municipalities across Southern California. OPSEC joins existing Sentinel subsidiaries United Security Specialists (USS) Elite—a uniformed guard service provider—and Gladiator Solutions, a manufacturer of ballistic gear.

“By integrating OPSEC’s specialized expertise and strong client relationships, we are positioning Sentinel as a leading provider of security systems across the West Coast,” stated Sentinel CEO Kyle Madej, according to a press release.⁷

• Allied Universal Acquires Mulligan Security (August 2025, Undisclosed) – In August 2025, global security conglomerate Allied Universal acquired Manhattan-based Mulligan Security from Protos Security (undisclosed). The transaction reinforces Allied Universal’s presence in the Northeast U.S. with uniformed security and fire and life safety services tailored to commercial properties, corporate office buildings, manufacturing facilities, hospitals, and company headquarters. Allied Universal has resumed heavy use of inorganic growth after a muted 2024, rolling up seven companies in 2025 providing an aggregate annual revenue boost of ~$695 million for the business, according to a press release.⁸ This growth strategy has largely focused on the Uniformed Guard segment, with the company acquiring Maxsent (May 2025, undisclosed); CI Security Specialists (May 2025, undisclosed); and (Pinnacle Security & Investigation (April 2025, undisclosed).

“In the third quarter of this year, we have continued our strategic acquisitions activity in North America, enabling us to further expand our geographic footprint, enhance our capabilities in key service categories, and better position the company to meet the changing needs of our customers,” said Allied Universal CEO Steve Jones in the press release.

• Menzies Aviation Acquires G2 Secure Staff (April 2025, $315 million) – Aviation service provider Menzies Aviation, a subsidiary of Agility Public Warehousing Company (KWSE:MKHZN), acquired G2 Secure Staff in April 2025 for an enterprise value of $315 million. G2 provides a range of staffing services to airports in the U.S., with a particular focus on security personnel including aircraft security sweeps, cargo security checks, parking lot guarding, and hangar protection. The deal is expected to increase Menzies’ revenue by 20%, surpassing $3.1 billion, according to a press release.⁹ Furthermore, the integration of G2 into Menzies Group will expand the company’s global footprint to 340 airports (+45.5%) and 65,000 employees (+41.7%), according to the press release.

“This acquisition is a key milestone in our longer-term value creation strategy…This deal enhances our presence in the United States—the largest and most dynamic aviation market worldwide,” stated Menzies Aviation Executive Vice President John Redmond, according to the press release.

School Districts Turn to New Technologies to Bolster Classroom Safety

Continued public funding for school security helped prop up end market demand and technology investment activity across the Security Solutions sector in 2025. The government has emerged as a key funding source for the purchase of the systems, equipment, and services used in today’s schools. In recent years, federal agencies have introduced numerous grants for school safety projects. Additional funding has been unlocked through the broadening of existing public safety programs—such as the $1 billion provided in 2025 via the Homeland Security Grant Program (HSGP)—allowing for the redirection of funds toward school security investments, according to the Federal Emergency Management Agency (FEMA).¹⁰ Recent technological advancements have enabled school administrations and public safety agencies to turn historically passive technologies—such as closed-circuit television (CCTV) video surveillance—into active forewarning and tracking systems. By integrating AI software into existing CCTV systems and installing new AI-enabled devices, facilities quickly gain capabilities such as facial recognition, license plate reading, real-time threat tracking, and proactive analysis and warning of criminal activity. The Metal Detection market has seen a much-needed injection of innovation in recent years, reintroducing the antiquated technology as an intelligent security resource. Weapon detection systems—such as those from Athena Security, CEIA, and Evolv Technology (Nasdaq:EVLV)—offer an efficient method of screening thousands of students through a combination of X-ray, traditional electromagnetic metal detection, and AI algorithms.

Ongoing innovation in the space positioned businesses with technology-enabled solutions as key acquisition targets in 2025. Acquirers selected these companies in pursuit of valuable intellectual property (IP) and proprietary software assets. Notably, Warburg Pincus acquired Raptor Technologies from Thoma Bravo in November 2025 for an enterprise value of $1.8 billion; the sponsor-to-sponsor deal highlights the investment opportunities within the School Safety market. Thoma Bravo scaled the company’s customer base to 60,000 schools across 55 countries through a series of add-ons since its initial majority stake investment in 2018, offering a strong exit opportunity for the firm, according to a deal press release.¹¹ For its part, Warburg Pincus acquired a business with strong recurring revenue streams diversified across domestic and international markets. Transactions targeting established technology providers were accompanied by investments in nascent organizations, demonstrating acquirer interest across company maturity stages. Aether Global Innovations (CNSX:AETH) acquired AI-powered footwear screening system developer Arion Defense in December 2025 for an enterprise value of $7.2 million after less than one year of operation. The company holds a valuable patent license from the Department of Energy’s (DOE) Pacific Northwest National Laboratory for its Footwear Screening Platform, with ambitions to penetrate international Homeland Security and Defense markets. The transaction illustrates the technological innovation permeating the sector while demonstrating buyer appetite for software-defined assets. Seeking to complement growth in end market demand for security software, acquirers also focused on the service providers and system integrators required to install and maintain these technologies. Repeat government contracts and a rapidly expanding customer base provide attractive opportunities for continued market consolidation. Backed by government funding, the School Safety market is expected to provide long-term opportunities for software developers and service providers alike, enhancing their value as M&A targets.

Public safety discussions permeated political and communal discourse in 2025, placing an enhanced spotlight on law and order and forcing leaders to increase investments in community safety. Response to the continued threat of mass shootings provided a significant source of funds for school districts to tap into, turning a historically cash-strapped end market into eager and active sector participants. A chronic nationwide gap in necessary police resources propped up demand for the Uniformed Guard segment, while the rapid construction of data centers provided a solid base for manufacturers, distributors, and system integrators in the Fire & Life Safety segment. Capstone expects Security Solutions M&A to continue its recent growth, fueled by increased levels of buyer competition combined with the emergence of attractive technology-enabled targets.

To discuss the market implications of security solutions innovation, school and public safety markets, provide an update on your business, or learn about Capstone’s wide range of advisory services and Security Solutions M&A knowledge, please contact us.

Brendan Bradley, Associate, was the lead Market Intelligence contributor to this article.

Endnotes

1. Federal Bureau of Investigation, “Officers Killed and Assaulted in the Line of Duty: 2024,” https://cde.ucr.cjis.gov/LATEST/webapp/#/pages/explorer/crime/special-reports, accessed December 2, 2025.

2. The International Association of Chiefs of Police, “2024 Recruitment & Retention Survey Results,” https://www.theiacp.org/resources/research-study/2024-recruitment-retention-survey-results, accessed December 2, 2025.

3. CBS8, “New Report Shows San Diego Police Staffing Shortages are Causing Longer Response Times,” https://www.cbs8.com/article/news/local/new-report-shows-san-diego-police-staffing-shortages-are-causing-longer-response-times/509-b3b1cf80-ac97-4f03-b158-abf376fca296, accessed December 2, 2025.

4. Flock Safety, “Accelerating Innovation: Flock Secures $275 Million to Advance Crime-Solving Technology,” https://www.flocksafety.com/blog/flock-safety-secures-major-funding, accessed January 13, 2026.

5. PitchBook, “Flock Safety,” https://my.pitchbook.com/profile/185188-06/company/profile, accessed January 13, 2026.

6. The San Francisco Chronicle, “Why Does Oakland Pay Millions to a Security Firm Linked to the FBI Corruption Case?,” https://www.sfchronicle.com/eastbay/article/oakland-abc-security-contract-21231459.php, accessed December 2, 2025.

7. ACCESS Newswire, “Sentinel Holdings Announces Acquisition of OPSEC Specialized Protection,” https://www.accessnewswire.com/newsroom/en/agriculture/sentinel-holdings-announces-acquisition-of-opsec-specialized-protection-1076522, accessed December 2, 2025.

8. Allied Universal, “Allied Universal Details Recent Merger and Acquisition Activities Targeting Strategic Growth,” https://ausnewsroom.aus.com/news/allied-universal-details-recent-merger-and-acquisition-activitiestargeting-strategic-growth, accessed December 2, 2025.

9. G2 Secure Staff, “G2 Secure Staff Enters Agreement to be Acquired by Menzies Aviation,” https://www.g2securestaff.com/menzies-aviation-strengthens-position-as-worlds-largest-aviation-services-provider-with-305m-deal-to-acquire-g2/, accessed December 2, 2025.

10. Federal Emergency Management Agency, “Homeland Security Grant Program,” https://www.fema.gov/grants/preparedness/homeland-security, accessed December 2, 2025.

11. Thoma Bravo, “Thoma Bravo Announces Sale of Raptor Technologies,” https://www.thomabravo.com/press-releases/thoma-bravo-announces-sale-of-raptor-technologies, accessed January 13, 2026.