2GIG Technologies to be Acquired for $135 Million; Will Join Nortek's Technology Solutions Segment
Nortek Inc., Providence, R.I., a global diversified company with leading brands and innovative, technology-driven products and solutions for residential and commercial applications, signed a definitive agreement to acquire 2GIG Technologies Inc. (2GIG) from APX Group Inc. A privately held company based in Lehi, Utah, 2GIG is a designer and supplier of residential security and home automation systems. Developed with the assistance of Nortek's Linear® business, 2GIG’s Go!Control™ touch-screen panel is an industry-leading, self-contained, all-in-one home security and automation control panel. 2GIG also provides wireless interactive home security services and a wide range of peripheral hardware devices and systems components for home security and automation solutions.
Under the terms of the agreement, Nortek will pay approximately $135 million for all of the outstanding common stock of 2GIG on a cash- and debt-free basis. The acquisition will be financed with a combination of cash on hand and borrowings under Nortek's asset-based credit facility. The transaction is expected to close during the first half of 2013, subject to customary closing conditions including approval pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
Nortek’s Technology Solutions business is a major manufacturing partner to 2GIG, which is a supplier to Vivint™, currently ranked as the third largest U.S. company based on RMR in the SDM 100. Nortek's acquisition agreement with 2GIG includes a five-year supply agreement with Vivint.
The Blackstone Group acquired Vivint, along with 2GIG in a $2 billion transaction last year.
“Acquiring 2GIG will position our Technology Solutions business as one of the world's top-tier hardware developers and manufacturers in the rapidly growing residential security and home automation markets,” said Michael J. Clarke, Nortek’s chief executive officer. “The transaction allows us to better provide long-term support to Vivint and other 2GIG customers. We look forward to welcoming 2GIG’s talented employee team into the Nortek family of companies.”
Sean Burke, group president of Nortek's Technology Solutions segment, added, “Joining forces with 2GIG will provide the other companies in our Technology Solutions Group with a range of exciting cross-selling opportunities. 2GIG offers products such as home thermostats, alarms and wireless carbon monoxide detectors that can be leveraged by these Nortek brands to grow their business with existing customer accounts. At the same time, these brands offer products that can expand and enhance the 2GIG home automation platform, potentially opening doors to new market opportunities.”