ADT approached 24 potential buyers after a private equity offer in February, but no alternative offers were made and the period to seek them is over, the company said Monday.
None of the companies from which ADT solicited offers were disclosed in a regulatory filing Monday.
Shareholders of the Boca Raton-headquartered security company are scheduled to vote April 22 on the $6.9 billion offer from an affiliate of Apollo Global Management. ADT shareholders would receive $42 a share, and the company traded on the New York Stock Exchange would go private.
The transaction represents one of the biggest leveraged buyouts — a takeover of a company using debt — in recent years. ADT has more than $5 billion in debt, according to S&P Global Market Intelligence, and an “enterprise value” — a measure of a company’s total value — of close to $10 billion.
The transaction would be financed through $1.56 billion in new first lien term loans; $3.14 billion in new second lien financing; the issuance of $750 million of preferred securities to an affiliate of Koch Equity Development LLC, the investment and acquisition subsidiary of Koch Industries; and an equity contribution of about $4.5 billion from funds managed by Apollo and co-investors.
If approved, the acquisition of ADT by Apollo’s affiliate and subsequent merger with Illinois-based Protection 1 is expected to be completed in June. Protection 1’s CEO, Timothy J. Whall, has been named ADT’s CEO, after completion of the transaction.
ADT has said it will keep its headquarters in Boca Raton, where it has 450 employees, and products and services will continue under the ADT brand. ADT provides mostly residential security services for some 6.5 million customers nationwide.