Feral Jundi

Tuesday, January 11, 2011

Mexico: Juarez Cranks Up Private Security

     Oscar Macías, the Juárez-based regional director of Securitas, said that while the company’s finances have been positive overall, they have not been as high as he’d like.

     For one, he said, the company’s earnings have been eaten up by investments in equipment and salary increases.

Since 2008, Macías said, Securitas has toughened up its training and recruiting processes and upgraded technology to meet the growing expectations of an increasingly demanding clientele. 

     “We have to invest in quality to make sure the client is satisfied,” he said.

      Having to ‘invest in quality to make sure the client is satisfied’?  Now that is music to my ears. lol  Not to mention salary increases and investments in equipment sounds great too.  You have to take care of your people if you want good customer service and satisfaction.

       But most importantly, these companies have to invest in good quality management to ensure that everything operates the way it is supposed to. From the shift leader all the way up to the project manager, a company must focus on quality management. You can have high salaries for employees and the best equipment ever, but unless your guard force is well organized, trained and managed, then all of that is for not. It is that management that will ensure good customer service and satisfaction, and continuous improvement (Kaizen).

     You know what would be an interesting study is to actually do a customer and employee/contractor survey to see exactly what the companies are doing right and what they are doing wrong in Mexico. With Juarez being the most dangerous city out there, perhaps in the world, this kind of study might be pretty influential in the realm of private security research and industry best practices. –Matt

Juárez cranks up private security

Businesses spent 45 percent more than in 2009

January 2011

By Alejandro Martínez-Cabrera

JUáREZ – Confronted with the city’s bloodiest year to date, businesses in Ciudad Juárez spent 45 percent more for private security in 2010 than the year before, according to figures reported by private security companies.

Juárez “is the city with the largest increase in security investments,” said Ivette Estrada, spokeswoman for the Private Security National Council, or CNSP, an association of security firms in Mexico. It calculated the increase using data provided by its 298 members.

The average increase in private security expenditures for Mexican border cities was 33 percent, Estrada said.

At the national level, the council estimated that companies in Mexico spent an average 11.3 percent of their production costs for insurance and security services in 2010, compared to 7 percent the year before and between 3 and 5 percent in 2008.

Last year was the most violent in Ciudad Juárez so far, with a record 3,111 drug-related killings, bringing the total number of violent deaths in the city since 2008 to at least 7,488.

Faced with the inability of Mexican authorities to stem the wave of crime and brutality pummeling the city, Juarenses have invested heavily in alarm systems, closing off streets with gates and hiring private security to guard neighborhood entrances.

(more…)

Saturday, December 25, 2010

Industry Talk: DynCorp Awarded One Billion Dollars For Training And Mentoring In Afghanistan

     Now this is impressive.  But what is even more impressive is DynCorp not mentioning a peep of this award in a press release.  This will be a huge endeavor and all eyes will be on this company.  For their sake, and for the sake of the war effort, I hope they will get it right out there. –Matt

December 23, 2010

     DynCorp International, LLC, Falls Church, Va., was awarded on Dec. 20 a $1,043,726,525 cost-plus-fixed-fee contract.  The award will provide for specialized training and mentoring services for the government of Afghanistan, and provide logistics and life support components for 14 training facilities in Afghanistan.  Work will be performed in Afghanistan with an estimated completion date of Aug. 19, 2014.  The bid was solicited through the Internet with eight bids received.  The U.S. Army Research, Development and Engineering Command Contracting Center, Aberdeen Proving Ground, Md., is the contracting activity (W91CRB-11-C-0053).

Wednesday, December 22, 2010

Iraq: Oil News–Local Security Firms Running A ‘Mafia’ To Artificially Inflate Prices

     This is a great little article that gives a snap shot of the current oil security business in Iraq. It also mentions the Chinese security teams operating there and some of the issues they have faced. For a quick primer on this, I posted some stuff about China’s plans in Iraq.

     Basra is also really bad for this kind of thing. It is to be expected that these Iraqi companies would try to inflate prices and jerk around the oil companies.  Haliburton and others should not be surprised that these local companies would be like this. –Matt

WikiLeaks cables: Iraq security firms operate ‘mafia’ to inflate prices

Halliburton executive’s comments reveal tensions between security firms, oil companies and the Baghdad government

By Rajeev Syal

Tuesday 21 December 2010

Halliburton’s senior executive in Iraq accused private security companies of operating a “mafia” to artifically inflate their “outrageous prices”, according to a US cable.

Written by a senior diplomat in the US’s Basra office, the confidential document discloses the tensions between private security firms, oil companies and the Iraqi government as coalition forces withdraw from protecting foreign business interests.

John Naland, head of the provincial reconstruction team in Basra, wrote in January this year that several oil company representatives complained of “unwarranted high prices” given an improving security situation since 2008.

“Halliburton Iraq country manager decried a ‘mafia’ of these companies and their ‘outrageous’ prices, and said that they also exaggerate the security threat.

“Apart from the high costs for routine trips, he claimed that Halliburton often receives what he says are ‘questionable’ reports of vulnerability of employees to kidnapping and ransom. He said that he recently saw an internal memo from their security company which tasked its employees to emphasize the persistent danger faced by IOCs [international oil companies].” Naland wrote.

(more…)

Tuesday, December 21, 2010

Maritime Security: The JLT ‘Private Navy’ Is Close To Kick-Off

      Woollerson would also like to see it involved in trying to remove the causes of Somali piracy through land-based initiatives.

     “I see the CEP as a self-destructing company. Maybe in many years’ time we will no longer be needed and could donate the tonnage to a Somali coastguard,” he said.

     This is a very interesting quote, and actually the entire article below is filled with some great stuff. Bravo to the author for getting the scoop and putting it out there for all to read. Here are my older posts with comments that first talked about this venture.

     Now for my take on the whole thing.  In order for this Convoy Escort Programme (CEP) to be a ‘self-destructing company’, it must take part in destroying their ‘Raison d’être’ –the pirates.  Escorting ships does not alone create this kind of market mechanism. Especially if they only plan on capturing 27% of the merchant traffic going through the GoA, and allowing the pirates to feast on the other 73% of the merchant traffic. If anything the consequence, intended or unintended, will be a higher concentration of armed pirates attacking undefended vessels.

    The other angle on this is that merchants and insurance companies will see how this works, and they too will fire up a similar business model.  That other 73% of the merchant market might shrink pretty fast with a higher concentration of pirates coming down on them, and an increase of insurance backed protective services available to them at a decent price.

    But this is where the quote up top really grabs me, and that is the land based initiatives of this CEP team.  Could there be something going on here, like JLT taking a hint from what is going on with Saracen International and their proposed private militia? I bet JLT wouldn’t mind attracting some of that funding coming from this middle eastern mystery donor either.

    Finally, there is the quote about a reputable flag state sponsoring these CEP vessels, and the concept of a government and military granting them ‘legitimacy’. That sounds like all the makings for a Letter of Marque or some kind of similar license to do what they are going to do. We will soon find out in the coming months exactly what kind of arrangement we have here. –Matt

‘Private Navy’ Is Close To Kick-Off

December 10, 2010

An insurance broker’s plan to create a “private navy” to combat Somali piracy is close to being launched.

Shipowners could be asked to back the project as early as late January or February with private military-escort vessels sailing alongside merchant ships by mid-2011.

A reputable flag state prepared to register the 18 patrol boats has been lined up, shipowner support is being canvassed and preparations made to secure funding for the vessels and crew.

Sean Woollerson of the Jardine Lloyd Thompson (JLT) insurance-broking group says there are still issues to overcome but the key task of securing government and military support to give the project “legitimacy” is almost there.

The venture, now branded as the Convoy Escort Programme (CEP), estimates it needs only £15m ($23.5m) to buy secondhand vessels suitable for use as patrol boats and the rest of the infrastructure.

Greek salvage entrepreneur George Tsavliris is already seeking support from fellow shipowners and Bimco has indicated a willingness to help facilitate the project.

(more…)

Saturday, December 18, 2010

Industry Talk: USTC Holdings Buys Xe Services For Estimated $200 Million

     This post by AM Law Daily had everything that I thought was pertinent to the story.  So Xe has finally been sold, and for an estimated 200 million dollars.

     I think what is really interesting with this acquisition is all the national security related stuff that goes along with buying a company like this.  When you buy Xe, you are buying all the really complex and sensitive government contracts they are involved with.  And like the article below pointed out, Michael Chertoff’s company (former Homeland Security Secretary) was heavily involved in making sure this was done correctly.

     So what will USTC Holdings do with Xe, now that they bought it?  Good question, but I am sure you won’t see a lot of change right off the get go. Matter of fact, you probably won’t see anything new with the company, other than it just having new owners. –Matt

Bingham, Mayer Brown Advising on Sale of Blackwater/Xe Services to Private Equity Group

December 17, 2010

By Brian Baxter

Xe Services, the private military contractor formerly known as Blackwater Worldwide, announced on Friday that it had been sold to a group of private equity investors with ties to company founder Erik Prince.

Terms of the transaction were not disclosed, but The New York Times puts the value of the deal at around $200 million. USTC Holdings, the investment group taking control of Xe, said in a statement that the deal includes all Xe companies that provide domestic and international security services, including the target’s training facility in Moyock, N.C.

Bloomberg reports that USTC is comprised of private equity firms Manhattan Partners and Forté Capital Advisors, whose managing partner, Jason DeYonker, has close ties to the Prince family. (Aaron Kanter serves as Forté’s chief compliance officer and in-house counsel.)

(more…)

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