Resideo to Spin-Off ADI Global Distribution, Creating Two Independent Companies.

Resideo Technologies is set to spin off its ADI Global Distribution business into a separate public company. The separation is expected to be completed in H2 2026, with Resideo's Products & Solutions business continuing as a standalone entity. Resideo will make a one-time payment of $1.59 billion to Honeywell International. The ADI segment delivered net revenue of $4.5 billion in the twelve-month period ended March 29, 2025.

Resideo Technologies, Inc. (NYSE: REZI) has announced plans to spin off its ADI Global Distribution business into a separate public company. The separation is expected to be completed in the second half of 2026, with Resideo's Products & Solutions business continuing as a standalone entity. As part of this strategic move, Resideo will make a one-time payment of $1.59 billion to Honeywell International Inc. (NASDAQ: HON) to eliminate all future payment obligations under an existing indemnification and reimbursement agreement.

The ADI segment, which serves as a global wholesale distributor of low-voltage products, including security and audiovisual solutions, delivered net revenue of $4.5 billion in the twelve-month period ended March 29, 2025 [1]. The separation is expected to enhance strategic flexibility, unlock value, and improve operational performance for both businesses. Jay Geldmacher, Resideo's president and CEO, stated that the move is the next natural step to allow ADI and Resideo's Products & Solutions (P&S) to unlock their full potential and better serve their respective stakeholders.

Following the separation, Tom Surran will continue to lead Resideo's P&S business, while Rob Aarnes will remain president of ADI. Jay Geldmacher's previously announced retirement will become effective upon completion of the transaction, after which he will serve in an advisory role for six months.

Resideo's P&S segment will continue to focus on residential controls and sensing solutions under brands such as Honeywell Home, First Alert, Braukmann, and BRK. The company claims a network of 100,000 professional installers and more than 15 million installations per year. For the 12-month period ending March 29, P&S reported $2.6 billion in net revenue and a segment adjusted EBITDA margin of 24.2% [2].

ADI will maintain its position as a global distributor of low-voltage products, serving both residential and commercial markets. Its portfolio includes more than 500,000 products across categories such as security, audio-visual, access control, and smart home automation. ADI’s offerings also include proprietary technologies and exclusive brands such as Control4, OvrC, Araknis Networks, and WattBox. For the same 12-month period, ADI reported $4.5 billion in net revenue with a segment adjusted EBITDA margin of 7.5% [3].

Resideo's advisors include Evercore for financial matters, Willkie Farr & Gallagher LLP as legal counsel, and Collected Strategies for strategic communications. The company expects to exceed its previously provided second quarter 2025 outlook for revenue, adjusted EBITDA, and adjusted earnings per share.

References:
[1] https://www.commercialintegrator.com/news/resideo-adi-spin-off/142760/
[2] https://www.securityinfowatch.com/distributors/article/55306608/resideo-to-spin-off-adi-distribution-business-creating-2-independent-public-companies
[3] https://www.commercialintegrator.com/news/resideo-adi-spin-off/142760/