What happened

Shares of Control4 (NASDAQ:CTRL) have skyrocketed today, up by 39% as of 1:30 p.m. EDT, after the company reported first-quarter earnings results. The maker of smart-home devices also announced that it is getting acquired.

So what

Revenue in the first quarter came in at $60.4 million, which translated into non-GAAP net income of $3.6 million, or $0.13 per share. The results were mixed relative to analysts' expectations, but the earnings were overshadowed by news that SnapAV is acquiring Control4 in a $680 million deal. The transaction is being funded entirely with cash, and values Control4 at $23.91 per share, representing a roughly 40% premium relative to yesterday's close.

Notebook with "Merger and Acquisitions" on the front

Image source: Getty Images.

Control4 had just recently closed its own $11.1 million acquisition of Switzerland's NEEO during Q1. Control4 finished the quarter with unrestricted cash and short-term investments of $72 million.

Now what

SnapAV and Control4 say the merger is "highly complementary" and will create a "true one-stop shop" that will offer a comprehensive portfolio of smart-home, control, and automation products. The combined company will have over 1,200 employees, and the deal is expected to close in the second half of 2019. SnapAV's majority shareholder, private equity firm Hellman & Friedman, will invest additional equity in SnapAV as part of the deal and be the majority shareholder of the combined company.

"We have pursued the mission of making our integrators' lives easier since SnapAV was founded," SnapAV CEO John Heyman (who will lead the combined company) said in a statement. "Dealers will be able to buy leading solutions, access the best service technicians in the industry and experience simpler installation through purchasing, support and seamless product integration."

Due to the acquisition announcement, Control4 did not host a conference call to discuss earnings results and is not updating its 2019 guidance.