Smart home products manufacturer and distributor Resideo is set to make a significant expansion for its ADI Global Distribution unit via an acquisition valued at $1.4 billion.

Scottsdale, AZ-based Resideo has reached an agreement to buy Charlotte, NC and Draper, UT-based Snap One — a like manufacturer and distributor of A/V, networking, surveillance, power and structured wiring products for connected homes and businesses.

Resideo will pay $10.75 per share for Snap One, which translates to about $821 million in cash. The deal is expected to close in the second half of 2024. Snap One will then integrate into ADI Global Distribution — which serves as a distributor of security, AV and low-voltage products.

Resideo said the acquisition is valued at approximately $1.4 billion, which represents a 7.4x multiple on Snap One’s adjusted EBITDA for the 12 months ended Dec. 29, 2023. Snap One had sales of $1.065 billion in that same last 12 months span, down from $1.124 billion in calendar 2022.

A $500 million perpetual convertible preferred equity investment from Clayton, Dubilier & Rice will fund the transaction, Resideo said in an April 15 news release.

Resideo said the deal will combine ADI’s position in security products distribution and Snap One’s complementary capabilities in the smart living market and Control4 technology platforms, which is expected to drive increased value for integrators and financial returns.

Snap One has five distribution centers and 41 branches across the U.S., according to the company’s November 2023 investor presentation.

“Together, ADI and Snap One will provide integrators an increased selection of both third-party products and proprietary offerings through an extensive physical branch footprint augmented by industry-leading digital capabilities,” the company said in the news release.

ADI was No. 7 on MDM’s 2023 Top Electrical, Data & Security Products Distributors List.

“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 CEO. “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.”

Snap One debuted in 2005 with the launch of SnapAV and Control4. Both firms were privately acquired in 2013 by separate firms before merging in 2019 and subsequently rebranded as Snap One in 2021. The company has nearly 50 product brands in its portfolio. 

“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.”