Like the year prior, the fire and life safety space saw a steady number of mergers and acquisitions (M&A) activity in 2025. Pye-Barker Fire & Safety continued to dominate in this regard. For another consecutive year, Pye-Barker completed, likely, the most acquisitions in the industry, with over 30 under its belt in 2025. The company now has a presence in 47 U.S. states, having newly entered Arkansas and Hawaii.

RapidFire Safety & Security, which offers expertise in fire, life safety and physical security services to the commercial sector, also completed multiple acquisitions, further adding to M&A activity in fire and life safety. Other notable acquisitions in the security dealer and integrator space include Alarm New England’s acquisition of Associated Alarm Systems, American Alarm’s acquisition of Instant Signal & Alarm, ORR Protection’s acquisition of Compass Fire Protection, Sciens’ acquisition of Fire Security & Sound Systems in N.Y. and Security Fire Systems’ acquisition of Lakeview Security, Fire & Communications.

That’s not to say 2025 was a full repeat of 2024 in terms of M&A activity. The year started off strong with the acquisition of Sonitrol New Orleans by Securitas Technology, bringing together unique security capabilities and expansive technology resources. This combination was a sign of coming trends and targets: technology, unification and consolidation.

The Major Trends

According to Raymond James’ 2025 Security & Safety Year-End Report, M&A activity began to strengthen in the third quarter, following a volatile start to the year. “Deal flow regained momentum as market participants have become more comfortable underwriting larger and more complex transactions, particularly in sectors demonstrating resilience and operational strength,” the report said. “The rebound reflects a broader shift toward optimism as market participants position for growth heading into year-end.”

SDM reported on nearly 100 acquisitions in 2025. Approximately 65% were completed in the second half of the year. Overall, 2025 was a decent year for M&A activity, and a slight improvement from 2024. Still, it didn’t measure up to the pre-COVID environment.

“You can’t overlook what occurred in 2020 with the pandemic,” says Les E. Gold, partner, Mitchell Silberberg & Knupp LLP, Los Angeles, Calif., and contributing legal columnist for SDM. “That slowed things up. I think this is still the aftermath where people are waking up a little bit, and they’re looking for growth. But I think the most important thing is the tremendous amount of money that’s available in the private equity industry. They have money. They have to pay their investors, so they have to get the money invested. I think that’s had a lot to do with the increase in activity in the M&A area in 2025.”

Kelly Bond, partner and co-founder, Bridgepoint Advisors, Frisco, Texas, adds, “The M&A environment in 2025 was shaped largely by a small group of highly active buyers that completed several premium, well-publicized transactions. The visibility of these high-priced deals encouraged more business owners to explore the market, motivated by the possibility of achieving similarly strong outcomes.”

The start of the year was impacted by financial concerns, which contributed to shaping the landscape throughout 2025. “Interest rates remained on the high side at the beginning of the year but then started to trend downward toward the end of the year; it’s yet to be determined what impact this will have on M&A activity,” say the collective experts at Barnes Associates, Orlando, Fla. “The industry continues to have strong support from specific lenders but could always use more debt providers. Private equity continues to be interested but is looking for the best performers in high growth sectors, especially where AI and video are being leveraged.”

Bond agrees. “For businesses with the right DNA, valuations remained highly competitive,” she says. “One of the most notable factors was the strength of the cash component; many transactions were completed with 100% cash at closing. In addition, several sellers were given the opportunity to roll equity into the transaction, creating an attractive path to participate in future upside while achieving liquidity.”

Tariffs were also a concern at the beginning of the year, but experts saw little to no impact on the security industry because of them. In fact, Gold says tariffs could have a positive impact on security overall. “If you were to ask me what I think in the future, I don’t think it’s going to impact the security industry because it’s going to impact other industries,” he says. “When it impacts other industries, crime increases. … It could have a very positive impact on the security industry.”

The M&A environment in 2025 was shaped largely by a small group of highly active buyers that completed several premium, well-publicized transactions. The visibility of these high-priced deals encouraged more business owners to explore the market, motivated by the possibility of achieving similarly strong outcomes.

Technology Influences All

Rapidly evolving technology is playing a major role in every aspect of security. Of course, that means M&A activity has been, and will continue to be, heavily influenced by artificial intelligence, the cloud, the hardware to software shift, and more.

Raymond James’ 2025 M&A Report highlights the shift from hardware to cloud and AI as a major trend in M&A, as both strategic and financial sponsors focused on acquiring software-as-a-service and AI capabilities. In Q1/25, Rhombus acquired Dashdive, a SaaS platform specializing in monitoring and analyzing multi-tenant cloud service costs, to optimize cloud cost structure at scale. Motorola acquired multiple cloud and AI companies, i.e. Theatro Labs, RapidDeploy, InVisit and Blue Eye, to continue expanding and differentiating its technology stack.

“The target profile is definitely shifting with the movement away from pure hardware (OEM) towards the companies with a focus on cloud/SaaS, AI and analytics, a focus on cybersecurity, scale for geographic expansion and/or companies with end-to-end solutions,” says Kim Loy, an independent consultant. “My expectation is we will see the profile shift and the activity accelerate in 2026.”

Rory Russell of Acquisition & Funding Services shares a similar perspective: “Sellers need to understand and embrace advanced technologies like AI and the cloud to make their firms more attractive. ... Numerous specialty consultants have emerged to assist buyers and help evaluate the seller’s internal processes and use of AI.”

Russell adds that larger, established consolidators are sensitive to non-traditional factors, such as technology posture, cybersecurity readiness and adaptation to AI, because it makes integration easier. “Thus, they are willing to pay more for firms who have these capabilities,” he says.

Buyers are increasingly prioritizing companies with scalable software platforms, recurring services and cloud-based infrastructure because these attributes support predictable revenue and operational efficiency, according to Kelly Bond of Bridgepoint Advisors. “Additionally, the continued convergence of cyber and physical security, combined with the growing use of AI for analytics, automation and threat detection, has become a meaningful differentiator, directly impacting both valuations and buyer interest,” she says.

Barnes Associates experts add, “Evolving technologies will continue to be an emphasis, but integration of its components will be key so that dealers can demonstrate the technologies’ capabilities to their customers.”

Les E. Gold of MSK says AI is the top technological factor poised to influence M&A activity. “How is that going to impact the industry? I don’t think anyone really knows, except the big companies are investing very, very heavily in AI,” he says. “I think that some people are going to get hurt in this industry because they have not stayed up with technology. ... I think new technology, new companies coming into the industry are going to affect it dramatically over the next few years. And I think that the companies that stay in it, their valuations are going to increase significantly.”

AI and other technologies are already adding changes to due diligence. “When you’re doing your due diligence now, you have to really look into what the company is doing, and, more importantly, what the company is not doing,” Gold says.

Independent of who the buyer is, they will check to see how AI is going to affect the potential target. Additionally, privacy has become a major issue. “It never has been in the past, but these security companies gain a great deal of information from their customers and subscribers. There’s been litigation regarding privacy issues,” Gold says. “When you’re doing your due diligence, you have to make sure that the company has really stayed up to date and has, in fact, made sure that they protect the confidential information they have. Buyers look at that because that could affect liability when they take these companies over.”

A Year of Surprises

In 2025, the residential sector made headlines when GTCR acquired SimpliSafe.

“GTCR not only purchased the commercial business of ADT, but they also acquired SimpliSafe, which is strictly a residential company. Effectively, they got out of the residential business, and then they got back in,” Gold says. He adds that Apollo, the private equity group that still owns a residential portion of ADT, now has a new, large competitor with GTCR on the residential side. “There’s a lot to be desired, I think, in what transpired there,” he adds.

“GTCR’s purchase of SimpliSafe was clearly a vote of confidence for the residential security market,” experts from Barnes Associates say. “It will be interesting to see how GTCR’s strategy evolves given their recent emphasis on the commercial sector. Are they moving from specialist to generalist?”

The move demonstrates an unexpected confidence in the residential sector, which fell beneath the M&A radar in 2024 as Pye-Barker put fire and life safety back on the map.

The amount of interest garnered from private equity also served as a surprise for M&A experts, like Rory Russell, owner, Acquisition & Funding Services, Kattskill Bay, N.Y. “Many more firms were actively seeking private companies to acquire, both PE firms as well as large corporations,” he says. “The financial sponsors (PE firms, family offices) have plenty of available cash on hand to do deals.”

Bond adds, “I was genuinely surprised by who ultimately decided to sell. Several business owners came to market whom I would not have expected to be sellers at this stage of their lives or careers, underscoring how compelling market conditions and strategic timing can influence even long-term operators.”

Predominantly, these private equity groups, as well as some strategic buyers, targeted companies that combine hardware with software/cloud/RMR. “The focus seemed to be on platform builds and carve-outs,” says Kim Loy, an independent consultant and deal advisor. “I believe that there were some hesitancies in the market (mid- to late-2025) due to economic uncertainty and what the overall impact of the tariffs would ultimately lead to. It may or may not have been a big surprise to many; however, the strength of valuations of AI/cloud-enabled players was at a premium with a strong push to monetize analytics and related services.”

GTCR not only purchased the commercial business of ADT, but they also acquired SimpliSafe, which is strictly a residential company. Effectively, they got out of the residential business, and then they got back in.

What Are Buyers Looking For?

Buyers are placing greater emphasis on transparency, consistency and defensible financial reporting.

“Buyers, lenders and investors evaluate businesses based on factors that reflect management discipline and operational performance, and that becomes apparent quickly when reporting is inconsistent or incomplete,” says Amy Becker, president, Astute Financial Consulting, Fort Collins, Colo. “When companies are unable to clearly track or explain these metrics, diligence often slows, and perceived risk increases. A clean RMR roll-forward showing beginning RMR, additions, cancellations and ending RMR is especially important because it helps buyers understand both the quality and sustainability of recurring revenue.”

Experts from Barnes Associate highlight the well-capitalized group of buyers in the marketplace that are trying to build out national platforms. “There is also a portion of the pool of owners at the independent and regional level that have reached the age where they are deciding what the future holds for them,” the group says. “The confluence of season of life with exit potential is tipping the scales for many owners.”

Loy believes that M&A will favor companies that have the monetization of services figured out and anticipates companies with scalable, privacy-preserving analytics will be in demand. Products that support mobile/biometrics and ACaaS models are also likely to see increased M&A interest from buyers. “Many offerings in this sector are still viewed as legacy brands, and many end users with enterprise systems are still migrating. Early adopters may be undervalued,” she says.

The M&A landscape is in a slightly tougher spot thanks to technological trends, as buyers are becoming more “picky” with their targets. “Acquirers are increasingly targeting AI‑first platforms, identity management tools and cloud‑native hosting providers, signaling a broader shift toward a more software‑driven security landscape,” says Steve Rubin, partner and co-founder, Bridgepoint Advisors. “That momentum is set to intensify in 2026. Expect faster dealmaking, deeper moves into IoT and OT security and continued expansion of managed services. Major players are preparing for larger, more strategic acquisitions, while smaller firms may struggle unless they offer truly differentiated AI or IoT capabilities.”

Jason Grelle, partner and co-founder, Bridgepoint Advisors, highlights a few areas that buyers are going to staunchly avoid: legacy systems, customer and revenue concentration risk, third-party vulnerabilities and weak supply-chain security. “Recurring revenue economics are under pressure in the alarm/security space,” he says. “Specifically, rising cost to create recurring revenue (RMR) and inflationary pressures can erode financial attractiveness,” he adds. “Expect buyers to scrutinize loyalty metrics, churn trends and cost of RMR creation more rigorously.”

Expect faster dealmaking, deeper moves into IoT and OT security and continued expansion of managed services. Major players are preparing for larger, more strategic acquisitions, while smaller firms may struggle unless they offer truly differentiated AI or IoT capabilities.

Article Contributions, Services & Advice

The following companies contributed to this article and offer services, as well as additional advice, for security companies that may be interested in selling in 2026.

Acquisition & Funding Services

Acquisition & Funding Services (AFS) is an alarm company broker specializing in fire, CCTV, integration and security alarm business acquisitions, sales, financing and mergers. A trusted and experienced alarm company broker, AFS provides a variety of services including business valuations, alarm company financing programs, guidance through the selling process and more to security businesses large and small.

Piece of Advice: “Do your research. Not all buyers are the same. Look closely at deal terms, not just the sell price. Find an advisor like AFS with deep industry experience to help evaluate in-bound inquiries and deal with interested buyers.” — Rory Russell

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Astute Financial Consulting

Astute Financial Consulting helps security and life safety companies operate with financial clarity and confidence. The company focuses on helping companies build strong financial practices such as clear RMR tracking, disciplined reporting and accurate accrual-based financial statements. This preparation allows companies to respond effectively to questions from buyers, lenders or investors.

Piece of Advice: “Whether you are thinking about selling your business or not, you should operate as if you are. Potential buyers, lenders and investors value a business based on factors that stem from how it is managed and how consistently it performs. The discipline required to prepare for a potential transaction is the same discipline that improves operations, reduces risk and increases confidence from all stakeholders. Even if a sale never happens, running the business this way creates long-term value.” — Amy Becker

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Barnes Associates

Barnes Associates is a group of advisors and consultants to the security alarm industry. The group specializes in M&A advisory, capital raise, performance benchmarking and strategic planning

Piece of Advice: “The industry continues to become more complex as more technology matures. As owners age, they need to decide if they want to participate in these advances or to sell to those that are willing to operate in an increasingly complex and competitive landscape. If they decide to sell, they need to make sure that everything is documented and they understand their business. Everything is becoming much more data centric.” — Barnes Associates experts, collectively

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Bridgepoint Advisors

Bridgepoint Advisors’ three co-founders specialize in guiding alarm, integration, and fire company owners, as well as central monitoring station operators, through the complexities of buying or selling businesses. With extensive expertise in the electronic security industry, the trio is dedicated to enhancing the buy/sell experience.

Piece of Advice: “I strongly encourage business owners to conduct their own due diligence on their businesses, whether internally or with the help of a qualified third party. The companies that successfully sold this year had clearly invested the time to become seller-ready. Their value was evident not only from a technology perspective, but also operationally. They had done their homework, and it showed, ultimately paying off in the outcome.” — Kelly Bond

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Independent Consultant

With over 25 years of senior management experience in the security industry, Kim Loy has achieved significant success within various global enterprises. Currently, she is an independent consultant and deal advisor. Image courtesy of Kim Loy

Piece of Advice: “As security becomes more software- and AI-enabled, how are you factoring that into due diligence or value assessment? I think those qualities will have a significant impact on valuations and willingness to acquire. All of these factors have shifted from ‘nice-to-have’ to value drivers.” — Kim Loy

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Mitchell Silberberg & Knupp (MSK) LLP

MSK has represented large and recognizable names in the industry from the earliest stages of formation to navigating M&A for the smallest and some of the largest in the industry. The security alarm and monitoring technology specialty practice includes stalwart members that have authored California’s alarm licensing law, as well as the contracts that are in wide use today.

Piece of Advice: “Security has always been an excellent business. Recurring revenue is priceless. My sense is, the industry is going to change. It’s probably still in its very, very early stages because of all the new players, the large players who are coming up with new technologies. I think that’s going to increase the value of these existing companies. If you stay with it, I think the value of the company is going to increase, so prices are going to increase. M&A is going to, I think, expand greatly.” — Les E. Gold

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Raymond James

 

Raymond James possesses a large and experienced team of investment bankers dedicated to the security and safety industry, covering the global marketplace with team members in both North America and Europe. With over 90 years of senior banker sector coverage and 400+ cumulative deals done by senior bankers, Raymond James possesses comprehensive sub-sector coverage, including access control, connected home, detection technologies, fire and life safety, systems integration, video technologies and more.

What Else Should We Expect in 2026?

In 2025 and a handful of years leading up to it, there has been a shift to the commercial segment, especially the integrator side of it and their ability to generate EBITDA given the acquirors’ appetite for it, say Barnes Associates experts. “This should continue in 2026,” they add. “In addition, 2025 was a big year for growth, especially in video, where several of the top players changed ownership.”

Alarm.com, for example, acquired CheKT in the first quarter, adding proactive video monitoring to its connected-property stack. “Pureplay video companies have led in exploring use cases and capabilities/limits to the technologies available,” Barnes Associates experts add. “As these solutions and offerings work themselves out, the learning and technology will become more accessible to the broader dealer universe.”

Russell expects small and medium-sized firms that can service a wide range of building systems (i.e. fire alarm, security, even sprinklers) will likely see increased M&A interest in 2026. “In past years, acquirers wanted larger, more profitable firms. As those deals got done, the focus is now on smaller, more modest firms,” he says.

Consolidation in fire and life safety was a major trend in 2025, as highlighted by Raymond James’ year-end report. In December, Investcorp acquired Guardian Fire Services to build a scaled, regional platform with strong route density, recurring regulated service revenue and a foundation for broader expansion across adjacent offerings.

Additionally, Russell believes the 2026 focus will be on service businesses with high recurring revenue as new construction is forecast to slow down. Any kind of financial uncertainties or unresolved legal/people issues will be glaring red flags for buyers in target companies.

Today, many deals are aimed at accelerating geographic growth, diversifying customer bases and creating new cross‑selling opportunities. “As regulations evolve, acquiring specialized expertise has become an efficient way to meet compliance demands,” Rubin says. “And in a fragmented market, consolidation offers scale, efficiency and access to valuable talent and intellectual property. Together, these forces are reshaping the industry and fueling a steady pace of strategic M&A activity.”

The dominant theme is consolidation. Wrapping up the year, Dean Drako, chairman of Brivo and founder of Eagle Eye Networks, announced the combination of the two companies, creating a large AI cloud-native physical security company. The merged company will operate under the Brivo name and deliver a unified cloud-native security platform.

“Customers will have one support team, one business relationship and one integrated cloud-native physical security solution,” Drako said of the merger, which will bring together AI, access control, video intelligence, visitor management and intrusion into a single solution.

As the industry moves toward bigger, technology‑centric platforms, 2026 is shaping up to be a year of rapid consolidation, bold expansion and AI-driven value.

Gold anticipates M&A activity to continue accelerating for years to come as companies look for growth and take advantage of the economies of scale. “The major disruption that I see really is the entry of the new large companies with new technologies,” he says. He provides, as an example, Amazon’s purchase of Ring in 2018. “They’ve become a major, major disruptor in the industry, particularly in the residential industry.”

Small and mid-sized security companies are at a crossroads of opportunity: build the scale to stay independent, or prepare for a sale? For the latter consideration, competing will require clear specialization, managed services or AI-driven offerings that stand out, Rubin says. “With valuations near historic highs, this may be an ideal moment to consider selling,” he advises. “Ultimately, the decision comes down to whether you can scale fast enough to compete or whether joining a larger platform unlocks greater longterm value. The real question is whether you want to help build the next national leader or compete against one.”