MONTREAL - Garda World Security Corp. plans to end its 14-year run as a public company after agreeing to be taken over in a $1.1-billion deal that would allow the cash logistics and security to grow while maintaining its high debt load.

The Montreal-based company said a consortium formed by founder, chairman and CEO Stephan Cretier and a subsidiary of funds advised by global private equity firm Apax Partners is offering $12 per share in cash.

The deal includes the assumption of $625 million of net debt.

"We are in a consolidating industry and we need to grow...you look at the menu or you are the menu," Cretier said Friday during a conference call.

He said it's extremely difficult in today's markets for a small-cap company to grow while feeling the constant pressure to deleverage.

"With this transaction the team and I have the firm intention to continue working tirelessly to build one of the top global players in the near future."

Cretier said he will retain a more than 25 per cent stake in Garda.

The offer for Garda's 32 million shares represents a 30-per-cent premium over the closing price of the company's Class A shares (TSX:GW) on Thursday and a 45-per-cent premium to their 90-day weight average.

Cretier responded to an analyst's challenge on the conference call about why the company is giving up the hope of returning its share price to the level of about $20 reached before the 2008 financial crisis.

"What we were living in 2007 and 2008, I think we need to forget about that," he said.

"For the share price to go up we need to deleverage and what we're saying today is that's not going to happen," he added, pointing to a third quarter in a row of growing indebtedness.

Garda's debt surged several years ago to fuel its aggressive expansion plans, particularly with the 2007 acquisition of U.S. cash logistics business ATI fro $395 million plus debt.

The privatization transaction was unanimously approved by Garda's board, with Cretier abstaining, following the recommendation of a special committee of independent directors. The board recommends shareholders support the transaction at a special meeting expected to be held in October.

UBS Securities Canada and Desjardins Capital Markets each provided opinions that the transaction is fair from a financial point of view to shareholders other than Cretier. Desjardins also concluded that Garda's fair market value was between $10.75 and $12.25 per share.

Garda's shares were halted on the TSX pending the announcement, and soared almost 30 per cent when trading resumed — up $2.73 at $11.93.

Shareholders, including Cretier, who hold about 25.6 per cent of the outstanding shares, have entered into agreements to support the transaction. The agreement requires the support of at least two-thirds of shareholder vote and by more than half of votes cast by Garda's minority shareholders.

Meanwhile, the Montreal-based company announced Friday that it earned $4.9 million, or 15 cents per share in the second quarter. That compared to $3.8 million or 12 cents per share in the prior year.

Revenues for the period ended July 31 increased 13.7 per cent to $337 million, from $297 million.

Cash logistics revenue increased 12.7 per cent, U.S. operations were up 13.9 per cent, security revenues increased 14.5 per cent, Canadian security excluding airport operations grew 1.01 per cent and emerging markets were up 81.8 per cent.

"The positive results we have achieved are an indication of the magnitude of the opportunities we can and must seize now," he added.