Snap One (NASDAQ:SNPO) stock is rising higher on Monday after the smart-living products company reached an agreement with Resideo (NYSE:REZI) for an acquisition.
A news release announcing the deal notes that Resideo is acquiring Snap One for $1.4 billion, including debt. That will have it paying $10.75 per share in cash for SNPO stock. This is a 32% premium over the shares’ closing price on Friday.
Resideo intends to fold Snap One into its ADI Global Distribution business following the acquisition. The company notes that it expects $75 million in annual synergies in the third year after the deal closes.
Resideo President and CEO Jay Geldmacher said the following about the deal:
“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. 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.”
Timing of the SNPO Stock Deal
The two companies are expecting the acquisition to close during the second half of 2024. It notes that both companies’ boards have given their unanimous support to the acquisition.
In addition to this, Hellman & Friedman is throwing its support behind the deal. It manages private investment funds that hold 72% of outstanding SNPO shares.
SNPO stock is up 30.2% as of Monday afternoon with more than 818,000 shares traded. Its daily average trading volume is below that at 32,000 shares.
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
