SCOTTSDALE, Ariz., and CHARLOTTE, N.C. – Resideo Technologies has agreed to acquire Snap One Holdings for $10.75 per share in cash, for a transaction value of approximately $1.4 billion, inclusive of net debt.Upon closing, Snap One will integrate into Resideo's ADI Global Distribution business. “The acquisition of Snap One is an exciting step in Resideo’s continued transformation through portfolio optimization, operational enhancements and structural cost savings actions,” commented Jay Geldmacher, Resideo’s president and chief executive officer. “ADI and Snap One are highly complementary businesses and together will meaningfully enhance our strategic and operational capabilities as a significant player in attractive growth categories.”He continued, “We are excited about the enhanced value proposition through increased product breadth, local availability, support services and broad market expertise, as well as the future opportunities this creates for integrators serving residential and commercial markets. In addition, the investment by Clayton, Dubilier & Rice is a testament to the strategic and financial merits of this transaction and provides financial flexibility as we continue to transform and optimize our portfolio. We look forward to the ADI and Snap One teams working together to drive value for all stakeholders through executing on the substantial business and financial synergies we see in combining the two businesses."The transaction combines ADI's position in security products distribution and Snap One's capabilities in the smart living market and Control4 technology platforms, which is expected to drive increased value for integrators and financial returns. Together, ADI and Snap One will provide integrators an increased selection of both third-party products and proprietary offerings through an extensive physical branch footprint augmented by industry leading digital capabilities.“Snap One has grown from a startup built by entrepreneurial integrators to an industry leader in smart technology, delivering seamless experiences to consumers and high-quality services and support to our integrators,” said John Heyman, Chief Executive Officer of Snap One. “This is the right next step to capture new opportunities to bring our solutions to market. The future of smart living is here. Demand for connected technology products continues to grow, and Resideo is the right owner to drive our expansion. We believe this transaction will deliver compelling value to our stakeholders and will create opportunities for our people and integrator partners.”During Resideo’s Q4 2023 report Geldmacher teased both future collaborations with ADT and a promise that the company would continue to execute its key strategic initiatives while driving profitability expansion and strong cash flow. Resideo saw revenue of $6.2 billion for 2023, an adjusted EBITDA of $552 million, and $440 million in cash from operations. Security Systems News (SSN) has reached out for comment regarding the acquisition.The transaction is valued at approximately $1.4 billion, including forecasted net debt of Snap One at the closing of approximately $460 million. This represents a 7.4x multiple on Snap One's Adjusted EBITDA for the twelve months ended December 29, 2023, as further adjusted by including Resideo's projected annual run-rate synergies of $75 million.The transaction is expected to be completed in the second half of 2024, and is subject to customary closing conditions, including receipt of applicable antitrust and other regulatory approvals. Resideo said it intends to use proceeds from committed debt financing, cash on hand, and a $500 million perpetual convertible preferred equity investment from Clayton, Dubilier & Rice LLC ("CD&R") to fund the transaction. Effective upon the closing, CD&R will have the right to designate two members to the Board of Directors of Resideo.
