Snap One a major supplier to the Lifestyle Store and the failed Theatre At Home operation with their Control 4 systems, has been sold to US security outfit Resideo Technology, shares in both Companies fell on the news.
Resideo Technologies has agreed to acquire Snap One Holdings for $2.19 billion, the transaction combines ADI’s position in security products distribution and Snap One’s capabilities in the custom install markets with their Control4 control systems.
This is the same Company that distributes Australian owned Bluestream products in the USA.
Global management claim that the move is expected to drive increased value for integrators.
The move will see Snap One integrated into Resideo’s ADI Global Distribution business, how that will play out in Australia is not known as the business has no presence in Asia Pacific.
“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.”
“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.”
In 2023 Resideo delivered revenues of A$9.68 billion for 2023, an adjusted EBITDA of $886 million, and $687 million in cash from operations.
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 US$75 million.
