Assa Abloy Won Every Door With Small Deals

Hello business enthusiasts,

Welcome back to Business Knowledge, where every week we look at one public company that sells something forgettable and earns serious money from it. We tell the story, then dissect the habit worth stealing for your own business.

• Company in focus today: ASSA ABLOY, Stockholm (Nasdaq Stockholm: ASSA B)
• What they sell: door locks and the key cards and phone apps that open them
• Read this twice if you have cash to buy a company and a banker keeps pitching you something big outside your core market.

In today's issue, we look at a string of hotel break-ins in Houston and the Swedish lock maker that spent thirty years buying the same kind of company over and over. You'll learn how to build a shortlist of small acquisitions inside your own category, all in about 5 minutes.

A $50 gadget and four million doors

In September 2012, a guest at a Houston hotel came back to find her laptop gone. The lock's own memory showed that no key had opened her door.

The hotel was the Hyatt House Galleria. NBC News reported that the lock's records showed no card had been used, whether hers, the housekeeper's, or a copy. Police arrested a suspect after the laptop turned up at a pawn shop.

The locks came from Onity. Two months earlier, at the Black Hat security conference in Las Vegas, a 24-year-old Mozilla developer named Serafina Brocious showed that a homemade device with less than $50 in parts could open Onity keycard locks through a small port on their underside.

The flaw sat in locks on more than four million hotel doors.

Onity first called the hack "unreliable and complex to implement," according to NBC News, and offered hotels a plastic cap for the port.

By December, Forbes reported that Onity was negotiating with the big hotel chains, Hyatt among them, over who would pay for new circuit boards. One Hyatt memo showed Onity charging $11 for every new board it installed.

The lock company nobody at head office thought about

Onity was a small unit inside United Technologies, the group that also owned Otis elevators and Pratt & Whitney jet engines. When UTC broke up in 2020, Onity went to Carrier, an air-conditioning company.

In December 2023, Carrier agreed to sell its whole security unit (Onity plus two other brands, about 1,200 employees) to Honeywell for $4.95 billion. Carrier's own SEC filing called the sale the first step in a portfolio transformation, alongside planned exits from fire safety and refrigeration.

So Onity had three owners in twelve years, and locks were the main business of none of them. Its parent company was busy thinking about jet engines, then air conditioners.

The Swede who kept buying the same thing

ASSA ABLOY was formed in 1994, when Securitas spun off its Swedish lock maker Assa and merged it with Finland's Abloy. The first chief executive was Carl-Henric Svanberg, who had run the alarm business at Securitas.

Svanberg bought locks. Then more locks. As group CEO from 1994 to 2003, he oversaw more than 100 acquisitions while yearly sales grew from SEK 3 billion to SEK 27 billion.

The Abloy side brought something useful into the merger. It owned VingCard, the Norwegian company whose engineer, Tor Sørnes, invented the first recodable hotel keycard lock in the 1970s, so when hotels began swapping metal keys for cards, the inventor of the card was already inside ASSA ABLOY.

That is the idea behind this whole issue: a hundred small acquisitions in one category are better than one large acquisition across three categories.

Bolt-on deal: a small purchase that plugs into a business you already run, selling to customers you already know.

What a small deal buys you

In 2025, ASSA ABLOY closed 23 acquisitions and reported sales of SEK 152 billion with 64,000 employees. Next to the group, the deals are tiny.

In the last quarter of 2025, seven acquisitions added combined yearly sales of about SEK 1.2 billion, under 1% of group sales.

One was Sargent and Greenleaf, a US maker of safe locks with about SEK 430 million in sales. Another was Kentix, a German firm with about SEK 90 million in sales that makes access control for data centers.

Every one of these sells to people ASSA ABLOY already knows: locksmiths, door installers, building managers, and hotel owners. The sales team can offer the full catalog on day one. And when a deal goes wrong, it goes wrong at a size the group barely notices.

The same habit carried the company from metal keys into electronics, one card-reader maker or phone-key software firm at a time. In the fourth quarter of 2025, sales of its electromechanical products grew 8% organically in the regional divisions.

The one time it went big

ASSA ABLOY broke its own pattern once. In September 2021 it agreed to pay $4.3 billion for the hardware division of Spectrum Brands, home of Kwikset and Baldwin.

The US Department of Justice sued to block it a year later, saying in its complaint that the two companies together held about 50% of US smart lock sales.

To settle, ASSA ABLOY sold Emtek, plus its Yale and August smart lock business in the US and Canada, to Fortune Brands for $800 million. The deal finally closed on June 20, 2023.

The big deal did go through, and it gave the company real scale in American homes. It also took 21 months of lawyers and cost ASSA ABLOY the US smart lock brands it had spent years building.

One deal that size carries one very large risk. A bad bolt-on at under 1% of sales is a mistake the group can absorb in a single year.

How to build your own bolt-on shortlist

Here are some takeaways if you are a business owner yourself:

• Map your category first. List every product your customers buy from the same budget line as yours, working through it with your sales lead in about 90 minutes. It worked if you end up with at least ten small companies selling to your exact buyers.
• Keep targets small. Pull rough revenue for each name and cut anything above 5% of your own sales, which takes one afternoon of searching. You know it worked when five names remain that your current managers could run without a new hire.
• Write the first-100-days checklist before you buy anything. List what changes in week one (bank accounts, pricing approval) and what stays the same (brand name, customer contacts), and budget about two hours. The signal is that a manager who has never done a deal could follow it.
• Run the Onity test on any large deal. Spend fifteen minutes asking who inside your company will still care about this business in five years, then write their name down. If the only name is the CEO's, pass.

Somewhere in your industry right now is a twenty-person company making one part your customers already buy. It gets more expensive the day someone else notices it.