Nearly one year to the day when Ingersoll Rand first announced that it would spin-off its security business; executives from Allegion celebrated the company’s recent debut as an independently traded company as they rang the opening bell at the New York Stock Exchange on Monday. SIW was invited to attend the event, which symbolically marked the beginning of a new chapter in the company’s history under the umbrella of the Allegion brand.
The company, which began trading on the public equity markets last week under the ticker symbol “ALLE,” is also now a part of the S&P 500 stock market index. Allegion sells commercial and residential access control products under 23 different brands including Schlage, CISA, Interflex, LCN and Von Duprin. The company has more than 7,600 employees worldwide and will be headquartered in Ireland, with regional corporate centers in Carmel, Ind., Brussels, Belgium, and Shanghai, China.
SIW sat down with Dave Petratis, Allegion’s chairman, president and CEO, as well as Tim Eckersley, the company’s senior vice president and president of the Americas region, at the NYSE on Monday to discuss the impact of the spinoff on their customers, as well as their long-term strategic goals for the company moving forward.
SIW: Tell me about the journey to get to where Allegion is at today – becoming an independent company and how far you’ve come since the spinoff was announced last December.
Petratis: A year ago there was a vision on the board of Ingersoll Rand that an independent company could be created. I am a strong advocate that focus in business is good and we are a focused security company with global capabilities and market leaders in many of the markets that we play in. What’s the most gratifying is that in an umbrella of uncertainty – “hey we’re going to be independent, we’re coming out of Ingersoll Rand which was a part of our lives for 25 or 30 years” – an employee survey was done and 78 percent of our employees said that this is a great place to be. We’re excited about the future and I think that’s just a strong testament to how bright it is for Allegion going forward.
Eckersley: It has been amazing actually. I think if you look at the amount of effort that’s required to carve out an organization like this out of a large, public company and the IT systems and the HR systems… it was an enormous amount of work by a lot of people all going on while we were still serving our customers and delivering against our profit plan.
SIW: What is the impact of this spinoff going to be on your global network of distributors and dealers? What kind of feedback have you received from them thus far?
Petratis: I think our distributor partners see our vision that we have a legacy company that has been a big part of distribution for over a century and our independence, our ability to invest strongly in our company, our products and our people will make a difference in their businesses.
Eckersley: It has been phenomenal. The feedback from our customers has been very positive in the things they’ve spoke about and the focus we now have as a pure security company and the ability to take our $150 million of cash flow every year and invest it in growth opportunities, new products and new capabilities. In terms of the impact, if we do our jobs right and we certainly intend to that, the impact will be zero to our customers other than the potential for new growth opportunities, new products and capabilities that we bring to the marketplace. Obviously, we have a significant presence in the residential space and the same quality that our customers have expected from us over the years will continue.
SIW: Were there ever any concerns about potential loss of brand recognition in making this move to become independent of Ingersoll Rand?