Investors urge sale of Brinks security

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Brink's Co., the Richmond security firm, is under pressure from stockholders to sell the company despite high fourth-quarter earnings.

Even with robust quarterly returns, Brinks has been confronted by investors who think the stock is undervalued and should sell its assets in 2007.

The company saw net income grow 165 percent to $126.6 million ($2.71 per diluted share) for the three months ended Dec. 31, compared with $47.7 million (83 cents) a year ago.

Brinks got a big boost from the sale of its freight transportation subsidiary, BAX Global Inc., in the first quarter of 2006. The asset was sold for $1.1 billion to Deutsche Bahn AG, a transportation and logistics company in Germany.

"It was the last of our non-core businesses to be sold," said Ed Cunningham, a spokesman for Brinks. "With the billion dollar sale we bought 21 percent of the stock back, reduced our debt and put $225 million in a legacy liabilities fund."

Even with impressive earnings for the quarter, two of Brinks largest investors, Pirate Capital LLC, a hedge fund in Norwalk, Conn., and MMI Investments LP, a New York-based hedge fund, are pressuring the company to consider strategic alternatives to increase shareholder value.

Pirate Capital and MMI Investments own a 8.5 percent and a 8.3 percent stake in Brinks, respectively.

One option investors have suggested is the sale or split of Brinks two subsidiaries, Brink's Inc., and Brink's Home Security, Inc.

Brink's Inc. is an armored car and ATM security company and Brink's Home Security Inc., monitors residential and commercial properties in the United States.

"I agree that ultimately two businesses need to be split up," said Brian Butler, an analyst for the Friedman, Billings, Ramsey Group Inc., an Alexandria-based investment banking firm.