Established in 1969 and based in Aurora, Illinois, First Alert is a leader in the home safety market with a strong omni-channel presence serving end users directly through retail and e-commerce channels and professional contractors through relationships with distributors and homebuilders. First Alert offers a comprehensive portfolio of detection and suppression devices including smoke alarms, carbon monoxide (CO) alarms, combination alarms, connected fire and CO devices, and fire extinguishers and other suppression solutions. Products are marketed through the First Alert, BRK and Onelink brands.  The company has over 2,800 employees and its operations include manufacturing in Juarez, Mexico and a primary distribution facility in El Paso, Texas.

"The addition of First Alert to the Resideo portfolio provides a highly complementary extension of our existing sensor solutions in the home," commented Jay Geldmacher, Resideo CEO. "Not only does First Alert bring a leading brand and market position in home safety, but its products also occupy a highly strategic position on the ceiling.

"We see significant operational synergies with First Alert's strength in retail and relationships with leading homebuilders and Resideo's strong partnership with professional contractors and distributors. First Alert advances our strategy of expanding Resideo's presence with contractors and broadening our suite of sensors for the home."

For the year ended December 31, 2021, First Alert generated approximately $395 million of sales and adjusted EBITDA of approximately $55 million. Resideo is targeting $30 million in annual cost synergies by the end of 2023 from the integration of manufacturing and distribution operations, and general operational and business support efficiency efforts. The company also expects to realise approximately $46 million in net present value of tax benefits as a result of making a joint election with Newell under Section 338(h)(10) of the Internal Revenue Code, which treats the majority of the transaction as an asset purchase for tax purposes.

The transaction is expected to be completed in the first quarter of 2022, and is subject to customary closing conditions, including receipt of applicable regulatory approvals.

For the quarter ended December 31, 2021, Resideo's preliminary expectations include revenue of $1.454 billion, gross margin of 27.2% and operating profit of $141 million.