Firm Overview
Compass Group Announces ADT in Agreement to Acquire Sunpro Solar
Compass Group Equity Partners announced today that their portfolio company Sunpro Solar has signed an agreement to be acquired by ADT (NYSE: ADT) for a combination of $160 million in cash plus 77.8 million shares of ADT stock, implying a total enterprise value of approximately $825 million, subject to certain adjustments. ADT plans to rebrand Sunpro to “ADT Solar™” and accelerate U.S. solar adoption by leveraging ADT’s expansive, best-in-class salesforce and existing customer base topping 6 million homes.
After extensive thematic research in the renewable energy sector, Compass Group identified Sunpro as a target in 2019 and led an investment group that included MGG Investment Group, TGP Investments, and Millstone Capital Advisors to acquire Sunpro in October of 2020. “We couldn’t be prouder of the performance of founder Marc Jones and the entire Sunpro management team in delivering on the strategic plan that generated explosive growth,” said John Huhn, Compass Group Managing Partner. “This transaction represents tremendous returns for our investors, and we’re excited to see the Sunpro team continue on their successful trajectory in partnership with ADT.”
Sunpro Founder and CEO Marc Jones said, “We were looking for more than a source of capital when we partnered with Compass Group, and they delivered on helping us achieve the next level of growth during our time together. We’re appreciative of their partnership, and we’re just as excited to begin the next chapter in our journey as we partner with ADT to further advance smart home technologies and renewable energy solutions for customers nationwide.”
Founded in 2008, Sunpro is a leading provider of rooftop solar systems in the United States. Sunpro markets, designs, sells, installs, and maintains solar power systems on residential and commercial properties through their 3,600-person, full-time workforce of solar energy professionals with 56 locations in 22 states. The company has been growing quickly, with a 90 percent year-over-year increase in installs compared to 2020. The transaction price represents approximately 10x estimated standalone forward EBITDA. The consideration is largely in stock, illustrating strong alignment between acquired management and shareholders. Sunpro founder Marc Jones and the entire Sunpro management team will join ADT to help build ADT Solar into the U.S. rooftop solar industry leader.
The completion of the transaction is subject to customary closing conditions, including regulatory approvals. The transaction is expected to close by year-end 2021.
Transaction Advisors
Citi is serving as financial advisor to ADT, and Morgan, with Lewis & Bockius serving as legal advisor to ADT. Deutsche Bank Securities Inc. is serving as the exclusive financial advisor to Sunpro, with Vinson & Elkins serving as legal advisor to Sunpro.
