Smart-home firm Resideo Technologies on Monday announced an agreement to buy industry peer Snap One in a deal worth $1.4 billion, including debt. Snap One shares jumped on the news, but Resideo stock fell.
Scottsdale, Ariz.-based Resideo agreed to buy Charlotte, N.C.-based Snap One for $10.75 per share in cash. Resideo said the combination will create a strong position in security, audio visual, and smart living technology distribution for residential and commercial markets.
On the stock market today, Resideo stock sank 3.5% to 20.34. Meanwhile, Snap One stock surged 29.5% to 10.54 on the news.
"The acquisition of Snap One is an exciting step in Resideo's continued transformation through portfolio optimization, operational enhancements and structural cost savings actions," Resideo Chief Executive Jay Geldmacher said in a news release.
Resideo Stock Is A Recent Breakout
Since he joined Resideo in May 2020, Geldmacher has overseen a series of acquisitions and divestitures.
In April 2022, Resideo completed its purchase of home safety products firm First Alert from Newell Brands for $593 million in cash.
Resideo's product portfolio includes thermostats, air comfort control systems, security cameras, smoke and carbon monoxide alarms, water leak detection devices and other gear.
On Feb. 14, Resideo stock broke out of a cup base at a buy point of 19.20, according to IBD MarketSurge charts. The move came after Resideo posted better-than-expected sales and earnings for the fourth quarter. The stock climbed as high as 23.21 on March 21 before falling amid overall market weakness.
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