Two industry leaders combine to empower
professional integrators with better service and better solutions
to more effectively serve the growing demand for connected homes
and businesses
Control4 shareholders to receive $23.91 per
share in cash
Acquisition expected to close in second half of
2019
SnapAV, a leading manufacturer and primary source of A/V,
surveillance, networking and remote management products for
professional integrators, and Control4 Corporation (NASDAQ: CTRL)
(“Control4”), a leading global provider of smart home solutions,
today announced that they have entered into a definitive merger
agreement (the “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.
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. 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.
Control4’s Board of Directors has unanimously approved and
recommended that stockholders vote in favor of the transaction.
Under the terms of the Agreement, SnapAV will acquire all the
outstanding common stock of Control4 for $23.91 per share in cash.
The purchase price represents a premium of approximately 40% 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%
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.
As award-winning industry leaders renowned for quality, service
and continuous innovation, 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+ 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,” said John Heyman, chief executive
officer of SnapAV. “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.
“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.”
“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,” said Martin Plaehn,
chairman and chief executive officer of Control4. “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.”
Together the combined company will bring a deep understanding of
the industry and an unmatched passion for providing best-in-class
solutions and service with one objective: create better experiences
for consumers and the integrators who serve them. Product
integration, remote management, expert service technicians, product
simplification, training and timely logistical capabilities will
ensure every install is easier, more reliable and delivers
fantastic experiences to consumers where they live and work.
“The combination of Control4 and SnapAV is transformative for
the smart home industry,” said Erik Ragatz, Partner at Hellman
& Friedman and chairman of the Board of Directors of SnapAV.
“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.”
More than 1,200 employees of the combined company will be led by
SnapAV CEO John Heyman and 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, North Carolina, and Salt Lake City, Utah, with offices
and local facilities around the globe.
Transaction Details
As part of the Agreement, Control4’s Board of Directors, with
the assistance of its advisors, will conduct a 30-day “go-shop”
process following the date of the execution of the definitive
agreement, during which it will actively initiate, solicit,
encourage and evaluate alternative acquisition proposals, and
potentially enter into negotiations with any parties that offer an
alternative acquisition proposal. Control4 will have the right to
terminate the merger agreement to accept a superior proposal,
subject to the terms and conditions of the merger agreement. There
can be no assurance that this “go-shop” will result in a superior
proposal, and Control4 does not intend to disclose developments
with respect to the solicitation process unless and until its Board
of Directors makes a determination requiring further
disclosure.
Subject to the go-shop, a special meeting of Control4’s
shareholders will be held as soon as practicable following the
filing of the definitive proxy statement with the U.S. Securities
and Exchange Commission (“SEC”) and subsequent mailing to
shareholders.
The transaction, which is expected to be completed in the second
half of 2019, is subject to the satisfaction of customary closing
conditions, including regulatory approvals and approval by Control4
shareholders.
Advisors
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.
Forward Looking Statements
This press release contains “forward-looking statements” within
the meaning of the “safe harbor” provisions of the Private
Securities Litigation Reform Act of 1995, including but not limited
to, statements regarding Control4’s business and financial outlook
and the structure, timing and completion of the proposed
transaction. All statements other than statements of historical
fact contained in this press release are forward-looking
statements. These forward-looking statements are made as of the
date they were first issued, and were based on the then-current
expectations, estimates, forecasts, and projections, as well as the
beliefs and assumptions of management. Forward-looking statements
are subject to a number of risks and uncertainties, many of which
involve factors or circumstances that are beyond Control4’s
control. Control4’s actual results could differ materially from
those stated or implied in forward-looking statements due to a
number of factors, including but not limited to: (i) risks
associated with Control4’s ability to obtain the stockholder
approval required to consummate the proposed merger transaction and
the timing of the closing of the proposed merger transaction,
including the risks that a condition to closing would not be
satisfied within the expected timeframe or at all or that the
closing of the proposed merger transaction will not occur; (ii) the
outcome of any legal proceedings that may be instituted against the
parties and others related to the merger agreement; (iii)
unanticipated difficulties or expenditures relating to the proposed
merger transaction, the response of business partners and
competitors to the announcement of the proposed merger transaction,
and/or potential difficulties in employee retention as a result of
the announcement and pendency of the proposed merger transaction;
and (iv) those risks detailed in Control4’s most recent Annual
Report on Form 10-K, and subsequent filings with the SEC in
connection with the proposed transaction, as well as other reports
and documents that may be filed by Control4 from time to time with
the SEC. Past performance is not necessarily indicative of future
results. The forward-looking statements included in this press
release represent Control4’s views as of the date of this press
release. Control4 anticipates that subsequent events and
developments may cause its views to change. Control4 has no
intention and undertakes no obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise. These forward-looking statements
should not be relied upon as representing Control4’s views as of
any date subsequent to the date of this press release.
Additional Information and Where to Find It
This press release relates to the proposed merger transaction
involving Control4 and may be deemed to be solicitation material in
respect of the proposed merger transaction involving Control4. In
connection with the proposed merger transaction, Control4 will file
relevant materials with the SEC, including a proxy statement on
Schedule 14A (the “Proxy Statement”). This press release is not a
substitute for the Proxy Statement or for any other document that
Control4 may file with the SEC and or send to Control4’s
stockholders in connection with the proposed merger transaction.
BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY HOLDERS
OF CONTROL4 ARE URGED TO READ THE PROXY STATEMENT AND OTHER
DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN
THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT CONTROL4, THE PROPOSED MERGER TRANSACTION AND
RELATED MATTERS. Investors and security holders will be able to
obtain free copies of the Proxy Statement and other documents filed
by Control4 with the SEC through the website maintained by the SEC
at http://www.sec.gov. Copies of the documents filed by Control4
with the SEC will also be available free of charge on Control4’s
website at www.Control4.com, or by contacting Control4’s Investor
Relations contact at the Blueshirt Group, LLC at (415) 217-2632.
Control4 and its directors and certain of its executive officers
may be considered participants in the solicitation of proxies from
Control4’s stockholders with respect to the proposed merger
transaction under the rules of the SEC. Information about the
directors and executive officers of Control4 is set forth in its
Annual Report on Form 10-K for the year ended December 31, 2018,
which was filed with the SEC on February 11, 2019, its proxy
statement for its 2019 annual meeting of stockholders, which was
filed with the SEC on March 20, 2019 and in subsequent documents
filed with the SEC. Additional information regarding the persons
who may be deemed participants in the proxy solicitations and a
description of their direct and indirect interests, by security
holdings or otherwise, will also be included in the Proxy Statement
and other relevant materials to be filed with the SEC when they
become available. You may obtain free copies of this document as
described above.
About SnapAV
Established in 2005 and based in Charlotte, North Carolina,
SnapAV is a manufacturer and exclusive source of more than 2,700
installation-friendly audio, video, networking, power and
surveillance products for residential and commercial A/V
integrators. SnapAV empowers integrators to run more efficient
businesses by providing high quality products at attractive prices,
supported by best-in-class online ordering and award-winning
customer service. Additional information about SnapAV and its
product brands can be found at www.SnapAV.com.
About Control4
Control4 [NASDAQ: CTRL] is a leading global provider of
automation and networking systems for homes and businesses,
offering personalized control of lighting, music, video, comfort,
security, communications, and more into a unified smart home system
that enhances the daily lives of its consumers. Control4 unlocks
the potential of connected devices, making networks more robust,
entertainment systems easier to use, homes more comfortable and
energy efficient, and provides families more peace of mind. Today,
every home and business needs automation horsepower and a
high-performance network to manage the increasing number of
connected devices. The Control4 platform interoperates with more
than 13,000 third-party consumer electronics products, ensuring an
ever-expanding ecosystem of devices will work together. Control4 is
now available in over 100 countries. Leveraging a professional
channel that includes over 5,900 custom integrators, retailers, and
distributors authorized to sell Control4 products, Pakedge
networking solutions and Triad speakers, Control4 is delivering
intelligent solutions for consumers, major consumer electronics
companies, hotels, and businesses around the world.
About Hellman & Friedman
Hellman & Friedman is a leading private equity investment
firm with offices in San Francisco, New York, and London. Since its
founding in 1984, Hellman & Friedman has raised over $50
billion of committed capital. The firm focuses on investing in
outstanding business franchises and serving as a value-added
partner to management in select industries including software,
financial services, business & information services,
healthcare, internet & media, retail & consumer, and
industrials & energy. For more information, please visit
www.hf.com.
Source: Control4
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Dana GormanAbernathy MacGregordtg@abmac.com(212) 371-5999
James BourneAbernathy MacGregorjab@abmac.com(213) 360-6550
William BraunAbernathy MacGregorwhb@abmac.com(212) 371-5999
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