Vivint Smart Home, Inc. (“Vivint”), a leading smart home technology company that is redefining the home experience through intelligently designed cloud-enabled solutions, and Mosaic Acquisition Corp. (NYSE: MOSC) (“Mosaic”), a publicly traded special purpose acquisition company, announced they have entered into a definitive agreement to merge Vivint with a subsidiary of Mosaic. Following the merger, Mosaic will be renamed “Vivint Smart Home, Inc.” With an agreed initial enterprise value of $5.6 billion, Vivint is anticipated to have revenues of $1.3 billion for fiscal year 2020E and Adjusted EBITDA of $530 million, implying an Adjusted EBITDA multiple of approximately 10.5x.
Vivint is one of the largest smart home companies in the world, delivering integrated smart home products and cloud-enabled services to 1.5 million subscribers across 98 percent of the zip codes in the U.S., and in Canada. Vivint offers a comprehensive suite of smart home products along with professional installation, nationwide in-home service, and 24/7 professional monitoring and customer care.
Todd Pedersen, Founder and CEO of Vivint, commented, “We are excited to partner with Mosaic to unlock the next chapter of the Vivint growth story. We remain committed to our mission of redefining the home experience through intelligently designed, cloud-enabled solutions delivered to every home by people who care. Just as it was in 1999 when I founded this business, to today where we are a multi-billion-dollar enterprise, our customers remain our focus. As the smart home market rapidly expands globally, Vivint is in the early stage of a massive opportunity and is ready to create the future of how we live and interact with our homes.”
“Vivint has defined the smart home – becoming the industry leader on the back of its innovative products, integrated solutions, and superior customer experience,” stated Peter Wallace, a Senior Managing Director at Blackstone. “We are proud to have supported the development of the company that has set the pace for the industry and are excited by the opportunity to invest further to support Vivint’s future growth.”
Alex Dunn, President of Vivint, added, “We look forward to leveraging David Maura’s prior M&A and operational experience leading a consumer-facing company, along with Fortress’ well-established capital markets expertise as we work towards Vivint’s continued success. Proceeds from this transaction will fortify our balance sheet, and enable us to continue to drive the innovation, customer focus, and service offerings that our customers have come to expect from us. We intend to remain disciplined in our capital allocation, while driving down customer acquisition costs without sacrificing organic growth.”
Following the closing of the merger, Vivint will continue to be led by its experienced management team, including founder and Chief Executive Officer Todd Pedersen, President Alex Dunn and Chief Financial Officer Mark Davies. All existing Vivint directors will serve on the board of directors of the combined company, joined by David Maura from Mosaic and, after the closing and subject to regulatory approval, by a director from the SoftBank Vision Fund.
David Maura, Executive Chairman and Chief Executive Officer of Mosaic Acquisition Corp., commented, “Having founded Mosaic in October 2017, I was determined to find not only the right target, but also the right partners. Todd and Alex have built an incredible business over the past 20 years, and I am honored to be a part of the team as we look into the future. The strong subscriber momentum, compelling unit economics, and multiple levers for organic growth represent a phenomenal opportunity to be at the cutting edge with technology that is changing the way we live. With most companies only deploying a standalone device strategy, Vivint differentiates itself as a fully integrated platform focused on unifying the customer experience in an efficient, seamless and simple way. I would like to congratulate Vivint and am pleased to confirm the Mosaic Board of Directors’ unanimous support for this transaction.”
Drew McKnight, Managing Partner of Fortress Investment Group LLC, commented, “We have followed Vivint for a long time and have deep respect for the company and its leadership team. We believe Vivint is extraordinarily well positioned as a leading IoT and connected-device business at an inflection point in the evolution of an industry. We are extremely excited about this investment and the opportunity to partner with Blackstone and the Vivint management team as the company builds on its position of recognized leadership and innovation shaping the connected world of tomorrow.”
More information on the announcement here.