Snap One Holdings Corp (SNPO) shares are experiencing a premarket surge following the announcement of a definitive agreement with Resideo Technologies for acquisition deal, valued at approximately $1.4 billion, inclusive of net debt. The per-share price of $10.75 represents a significant 32% premium to Snap One’s closing share price on April 12, 2024.
At the time of this publication, Snap One Holdings Corp. (SNPO) is trading at $10.6 per share, reflecting a change of $2.46, or 30.221128%. The trading volume stands at 778,953 shares, with an average analyst rating of 2.0, indicating a “Buy” sentiment, and a book value of $10.005.
The acquisition deal underscores a 7.4x multiple on the adjusted EBITDA of Snap One for the twelve months ending December 29, 2023, further enhanced by projected annual run-rate synergies of $75 million. The transaction, subject to customary closing conditions, is expected to be finalized in the second half of 2024.
Upon completion, Snap One will be integrated into Resideo’s ADI Global Distribution business, leveraging synergies to enhance strategic and operational capabilities. Resideo anticipates the transaction to be accretive to its non-GAAP EPS in the first full year of ownership, with a favorable revenue growth trajectory and margin profile for ADI and Resideo.
Resideo plans to finance the acquisition through committed debt financing, existing cash reserves, and a $500 million perpetual convertible preferred equity investment from Clayton, Dubilier & Rice (CD&R). Jay Geldmacher, Resideo’s President and CEO, emphasized the complementary nature of ADI and Snap One’s businesses, highlighting the strategic value of the acquisition. John Heyman, CEO of Snap One, expressed confidence in Resideo’s ability to drive expansion and capitalize on emerging opportunities in the smart living market.
The acquisition deal between Snap One Holdings Corp and Resideo Technologies marks a significant milestone in the evolution of both companies, positioning them for enhanced strategic and operational synergies. With Snap One set to integrate into Resideo’s ADI Global Distribution business, stakeholders anticipate favorable financial metrics and accelerated growth prospects. As the transaction progresses towards closure, investors remain optimistic about the combined entity’s potential to capitalize on emerging opportunities in the connected technology market.
