January 7, 2025
Acuity Brands Finalizes $1.2 Billion QSC Deal
QSC's $535M now makes up two-thirds of Acuity's Intelligent Spaces Group revenues
Acuity Brands, North America's largest lighting company, has officially completed its $1.215 billion acquisition of QSC, LLC, a provider of cloud-managed audio, video, and control (AVC) platforms. The deal, first announced in October 2024, aligns with Acuity's strategy to expand its Intelligent Spaces Group (ISG), a division focused on building-centric technology platforms.
QSC’s annual revenues of $535 million now make up roughly two-thirds of Acuity Brands’ Intelligent Spaces Group, which includes Distech Controls, Atrius, and KE2 Therm. The ISG division, excluding QSC, generated $292 million in total sales for fiscal 2024, highlighting the significant impact of QSC on the newly combined ISG portfolio.
The acquisition was financed through a combination of cash reserves and a newly amended credit agreement, which included a $600 million delayed draw term loan facility. This facility, facilitated by JPMorgan Chase, was introduced as part of a broader amendment to Acuity’s 2022 credit agreement.
The $600 million loan is designed to enhance Acuity's financial flexibility, with a repayment deadline set for June 2027. This facility features interest rates tied to prevailing market benchmarks, ensuring competitive financing terms. The loan's structure includes a delayed draw feature, allowing Acuity to access funds as needed before May 2025, specifically to support strategic initiatives such as the QSC acquisition.
Acuity's Financial Readiness
Acuity has demonstrated its financial readiness for such large-scale investments. The company’s cash reserves surged from $397.9 million at the end of fiscal 2023 to $845.8 million at the close of fiscal 2024. These reserves, combined with the term loan facility, provided a robust financial foundation for the QSC acquisition.
With the acquisition now finalized, Acuity expects the deal to be accretive to its adjusted diluted earnings per share for fiscal 2025. The company anticipates further expansion in ISG’s market share as it integrates QSC’s advanced AVC capabilities into its existing product lines.
As the smart building market continues to evolve, Acuity’s strategic investments position it as a key player in delivering innovative and efficient building management solutions.
