By: Security Systems News
CHARLOTTE, N.C. and SALT LAKE CITY—SnapAV, a manufacturer and primary source of A/V, surveillance, networking and remote management products for professional integrators, and Control4 Corporation, a global provider of smart home solutions, recently announced that they have entered into a definitive merger agreement whereby SnapAV will acquire Control4 in an all-cash transaction for $23.91 per share in cash, representing an aggregate value of approximately $680 million. The acquisition is expected to close in second half of 2019.
“The combination of Control4 and SnapAV is transformative for the smart home industry,” Erik Ragatz, partner at Hellman & Friedman and chairman of the Board of Directors of SnapAV, said in the announcement. “The increased resources of the combined company will enable it to invest more to drive innovation and deliver best-in-class features, functionality and products. This combination will also allow us to support integrators more effectively than ever before in pursuit of our joint goal of bringing the promise of the connected home to life.”
This highly complementary combination will leverage the increased resources of the two companies to provide integrators with a true one-stop shop, offering a complete product portfolio of custom smart-home, control and automation solutions. “Together, SnapAV and Control4 will drive increased innovation, simplified integration and compelling solutions that meet the demands of today’s expanding smart home industry,” the press release reads. “With leading technology solutions, a broad geographic footprint and exceptional service organizations, the combined company is poised to provide integrators with better opportunities to serve customers in the connected home and business markets.”
The purchase price represents a premium of approximately 40 percent over Control4’s closing price on May 8, 2019, the last trading day prior to execution of the Agreement, and a premium of approximately 38 percent over Control4’s 30-trading day weighted average share price ended on May 8, 2019. Private equity investment firm Hellman & Friedman — SnapAV’s majority shareholder since 2017 — will invest additional equity as part of the transaction and be the majority shareholder of the combined company.
“We believe today’s announced transaction delivers compelling and immediate value to Control4 shareholders in the form of a significant share price premium, and we are excited to have the opportunity to join with the SnapAV team,” Martin Plaehn, chairman and CEO of Control4, said in a prepared statement. “Together with SnapAV, we will be able to invest even more in innovation, bring together and build upon the very best of our combined capabilities, and do so with improved reliability, responsiveness, security, and privacy for consumers. Today’s announcement will enable us to better serve the expanding smart home market, making the lives of integrators easier and their businesses more effective and efficient.”
SnapAV and Control4 share a deep understanding of and commitment to the custom installation industry and are dedicated to making professional integrators more successful. By merging, SnapAV and Control4 will combine the talent of their collective 1,200-plus employees, market-leading solutions, exceptional interoperability and channel platform, dealer-first programs, global distribution and financial resources to deliver value in ways no one else can—enabling integrators to serve their customers better and grow their businesses.
“We have pursued the mission of making our integrators’ lives easier since SnapAV was founded,” SnapAV CEO John Heyman said in the announcement. “Dealers will be able to buy leading solutions, access the best service technicians in the industry and experience simpler installation through purchasing, support and seamless product integration.”
He continued, “Over the past several years, we have accomplished a number of goals we felt were critical to the success of integrators and the continued growth of SnapAV—including offering local delivery and pick-up through the acquisition of distribution sites around the country and expanding the suite of products available to support integrators. Merging with Control4 and its outstanding team will help us execute on our third critical goal: delivering the industry’s leading automation platform that integrates with the numerous technologies and products required to create customized smart home experiences homeowners desire. Control4 offers a leading automation platform, along with key smart home solutions in the audio, video, lighting, security and networking categories. We are especially excited by the fact that both of our companies have similarly strong ‘customer first’ corporate cultures centered on quality, service and innovation, and we look forward to creating new and exciting opportunities for the teams at both Control4 and SnapAV. In sum, the two companies will be better together, with better service, better solutions and better opportunities for integrators and employees.”
Heyman will lead the combined company along with an executive team made up of leaders from both SnapAV and Control4. Control4 CEO Martin Plaehn will join the Board of Directors of the combined company, helping to ensure a smooth integration of the businesses. The merger reflects the value created by bringing together two industry-leading teams of employees who, united, can better serve the needs of the growing smart home segment. The company will share joint headquarters in Charlotte, N.C., and Salt Lake City, Utah, with offices and local facilities around the globe.
In connection with the transaction, Simpson Thacher & Bartlett LLP is serving as legal advisor to SnapAV. Raymond James & Associates, Inc. is serving as financial advisor to Control4 and Goodwin Procter LLP is serving as legal advisor.
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