Resideo Set to Buy Snap One
Resideo, a leading provider of home comfort and security solutions, has announced its acquisition of Snap One, a prominent player in the smart technology industry, for approximately $1.4 billion. The deal, valued at $10.75 per share in cash, is set to bring together two complementary businesses, enhancing Resideo's position in the smart living and security markets.
John Heyman, CEO of Snap One, expressed his belief that the acquisition by Resideo is the right next step to capture new opportunities to bring their solutions to market. Heyman stated, "Snap One's capabilities for smart living integrators, combined with ADI's complementary position in adjacent security products distribution, will allow the combined organisation to materially deepen relationships with integrators to better serve their customers and expand their businesses."
Jay Geldmacher, Resideo's president and CEO, considered the acquisition an exciting step in Resideo's transformation. He stated, "The future of smart living is here, with demand for connected technology products continuing to grow. This acquisition will enable us to provide integrators with an increased selection of both third-party products and proprietary offerings, enhancing the buying experience and simplifying product availability."
The transaction is expected to be accretive to Resideo non-GAAP EPS in the first full year of ownership. It will also drive increased value for integrators, as there is an additional opportunity to enhance value within the Control4 integrator base through increasing service levels, rapid product fulfilment, and expanding exclusive offerings.
The investment by Clayton, Dubililier & Rice provides financial flexibility as Resideo continues to transform and optimize its portfolio. The transaction financing has been structured to allow Resideo to preserve financial flexibility for future strategic initiatives.
Snap One, an industry leader in smart technology, generates 66% of its sales from proprietary products in 2023, and these offerings typically carry significantly higher gross margins than third-party products. The acquisition combines ADI's strong position in security products distribution with Snap One's capabilities in the smart living market and Control4 technology platforms.
Together, ADI and Snap One will provide integrators with an increased selection of both third-party products and proprietary offerings, backed by an extensive physical branch footprint and industry-leading digital capabilities. The acquisition is expected to create a true omni-channel experience for integrators, simplifying the buying experience and enhancing product availability.
The combination is expected to drive increased value for integrators and financial returns. Resideo is confident that it is the right owner to drive Snap One's expansion, as stated by Snap One's CEO. The transaction is a testament to the strategic and financial merits of the transaction.
However, there is no available information about when the acquisition is expected to be completed. The news of this acquisition underscores Resideo's commitment to innovation and growth in the smart living and security markets. As Resideo continues to transform and optimize its portfolio, it is poised to deliver even more value to its customers and shareholders.
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