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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