In a deal valued at $825 million, the Boca Raton, Florida-based company announced its plans to buy Sunpro Solar and launch a new company unit called ADT Solar. The sale was done with $160 million in cash, which will go primarily toward debt reduction and sellers' taxes, plus around 77.8 million shares of ADT stock.
Launched by Marc Jones in 2008, Sunpro Solar, Mandeville, La., has been producing solar panels for residential and commercial properties. It currently has 3,600 full-time employees in 56 locations and 22 states.
Jones will join ADT to lead the new unit specializing in solar installation.
The market reacted strongly to the news as ADT stock on Tuesday closed 12% higher at $10.09. The move comes as more and more homeowners look for environmentally-friendly alternatives for energy.
ADT President and Chief Executive Officer Jim DeVries said that the acquisition is part of an overall push by ADT to expand into the energy management space. The company can now offer customers solar energy as part of cross-selling and various package deals.
"With its strong focus on the customer, Sunpro is the perfect partner for ADT and a logical extension of our ecosystem, unlocking an integrated home experience that includes security, automation, and energy management," DeVries said in a press statement.
ADT said that the $825 million deal is worth 10 times Sunpro’s estimated 12-month earnings before interest, taxes, depreciation and amortization.
The deal will need to pass regulatory approval but is slated to close by the end of 2021.