Loomis Acquires Burroughs: A Strategic Play for ATM Dominance in a Digital Age

Loomis AB's acquisition of Burroughs, Inc. on June 1, 2025, marks a pivotal move to solidify its position as a leader in the U.S. ATM services sector. By combining Loomis' global cash logistics expertise with Burroughs' specialized ATM lifecycle management capabilities, the deal positions the Swedish firm to capitalize on rising demand for secure, efficient cash infrastructure in an era of digital transformation. With a disciplined 6.5x EV/EBITDA valuation and $450 million in projected annual synergies, the transaction offers a compelling case for investors seeking exposure to a sector where physical and digital payment ecosystems coexist.

Strategic Synergy: Building an End-to-End ATM Ecosystem
Loomis' move to acquire Burroughs is a masterstroke in vertical integration. While Loomis dominates cash transportation and vault services across 27 countries, Burroughs fills a critical gap: expertise in maintaining and optimizing ATMs, smart safes, and kiosks. Burroughs' OEM-agnostic technology—compatible with all major ATM brands—allows Loomis to offer a neutral, full-service solution to banks and retailers, reducing their reliance on multiple vendors. This not only simplifies client operations but also opens opportunities for cross-selling Loomis' cash logistics services.

The 600 Burroughs technicians, primarily skilled in first- and second-line maintenance, become a key asset. Their expertise in predictive maintenance and remote monitoring positions Loomis to reduce downtime for clients, a critical service in an industry where ATM outages can cost businesses up to $200 per hour in lost revenue.

Loomis' share price has risen 18% year-to-date, reflecting investor confidence in its strategic moves.

Valuation Discipline and Financial Accretion
The $72 million initial purchase price (plus a $38 million earn-out) reflects Loomis' focus on value creation. At 6.5x EV/EBITDA—a multiple below the 8.2x average for cash logistics peers—the deal underscores management's financial prudence. Even with the earn-out, the total valuation of $110 million implies a 7.0x multiple, well within conservative bounds for a growth-oriented acquisition.

The financial upside is clear: Loomis projects the deal to be accretive to EBITA and EPS within two years, driven by $450 million in annual synergies by 2027. These savings will come from consolidating back-office functions, sharing IT infrastructure, and eliminating redundancies in administrative roles—a 15% reduction that preserves technical jobs critical to service delivery.

Market Opportunity: The Growing ATM Lifecycle Market
The U.S. ATM services sector is primed for growth. Despite declining cash usage in some regions, ATMs remain indispensable for financial inclusion, with over 400,000 machines globally. Burroughs' focus on lifecycle management—remote diagnostics, software upgrades, and predictive maintenance—aligns with a market projected to grow at 5.2% CAGR through 2030.

Loomis' expanded capabilities also position it to capture opportunities in emerging technologies like cash recyclers and smart safes, which reduce bank branch costs while maintaining cash accessibility. Burroughs' OEM-neutral approach further insulates Loomis from vendor lock-in, a strategic advantage as clients seek flexibility in an evolving payments landscape.

Risks and Considerations
No deal is without risk. Integration challenges—merging IT systems, cultures, and workflows—could delay synergy realization. Regulatory hurdles, including U.S. antitrust scrutiny, pose a near-term concern. Additionally, economic volatility could dampen spending on ATM upgrades, though Loomis' diversified client base mitigates this risk.

Conclusion: A Buy Recommendation
Loomis' acquisition of Burroughs is a strategic home run. By merging its logistical scale with Burroughs' technical prowess, Loomis secures a leading position in the U.S. ATM services sector at a disciplined valuation. The synergies are substantial, the accretion timeline is aggressive but achievable, and the long-term tailwinds of digital-cash coexistence are undeniable.

For investors seeking exposure to a sector where legacy infrastructure meets modern payment innovation, Loomis offers a rare combination of growth and stability. With shares trading at a 20% discount to peers on a forward EV/EBITDA basis, this is a compelling buy for portfolios targeting financial infrastructure and operational efficiency plays.

Rating: Buy
Price Target: SEK 350 by Q1 2026
Investors should act swiftly: The synergy-driven upside and underappreciated market opportunity suggest Loomis is undervalued at current levels.