Allegion starts a new life as standalone security company

Allegion Plc, a global provider of security products and solutions, debuted Monday as a publicly traded company following its spinoff from multinational corporation Ingersoll Rand, with the new company's Asia-Pacific headquarters located in Shanghai.

With the spinoff, Allegion hopes to increase annual sales from its current $2 billion to more than $3 billion over the next 20 years, which is more than one-tenth of the global market value of the security and protection industry.

"This is an opportunity to carry forward the best of Allegion's heritage, expertise and entrepreneurial roots while becoming bolder at capitalizing on major trends in commercial and residential security," said Dave Petratis, chairman, president and CEO of Allegion, adding that it will invest in the electronic side of the business as well as maintain the same level of dedication to the continuous improvement and advancement of its mechanical products.

Allegion, formerly a division of Ingersoll Rand, specializes in making security products, such as residential and commercial locks, door closers, panic release bars, access control systems and workforce productivity systems, under 23 brands in more than 120 countries.

One major benefit of the spinoff from Ingersoll will be to maximize the interests of stakeholders. Another will be to accelerate Allegion's growth rate past the security and protection industry's global average of 4 to 6 percent annually, said Yu Feng, president of Allegion Asia Pacific region.

Asia Pacific now contributes about 11 percent to Allegion's sales revenue, and China accounts for more than half of Asia Pacific's sales revenue.

"We have every confidence that the part played by China will grow considerably," Yu said.

The central government's emphasis on security was evident from the Decisions on Major Issues Concerning Comprehensively Deepening Reforms released in November after the Party plenum. Over time, there will be growing demand for security products, the individuals and the society as a whole, Yu said.

Regarding the huge demand, Allegion invested in a new security and protection products company in Shanghai at the beginning of this year with registered capital of $50 million. Apart from that, it has set up a research institute and a training center to better serve the Chinese market. Over the past two years, Allegion has seen the number of its offices in China grow from four to more than 20.

The location of Allegion's Asia Pacific headquarters in Shanghai will help to bring more advanced technology to China, its regional president said. It will expedite sending the latest trends from China and the Asia-Pacific market to the global headquarters in Ireland.

"Merger and acquisition will be a very important way for Allegion to grow faster and bigger in the future," said Yu.

Allegion will focus on three major markets in China: residential buildings, public institutions such as hospitals and schools, and factories.

But Yu also is hoping for more laws and regulations to make the market more complete. "The fire that killed 119 people at a poultry plant in Northeast China's Jilin province in June should have rung the bell for us that education of work safety is far from enough. Laws should catch up," he said.

Yu expects that the industry will sustain double-digital growth over the next 10 to 15 years, more than double the country's GDP growth.

shijing@chinadaily.com.cn

(China Daily USA 12/03/2013 page13)