Australian Internet of Things (IoT) vendor Buddy Platform on Wednesday announced that it has entered into a binding agreement to fully acquire San Francisco-headquartered smart lighting vendor LIFX for about $51 million in a cash and stock transaction.
As part of the deal, Buddy will absorb LIFX’s 48 employees across offices in Melbourne, Australia, Silicon Valley and Shenzhen. Following the completion of the acquisition, LIFX’s chief technology and product officer, Marc Alexander, will join the Buddy board of directors, per a company statement.
The acquisition will be revenue and earnings accretive for Buddy, with LIFX expected to reach profitability in CY2019, the statement added.
“This is a transformational transaction that we’re announcing today,” Buddy chief executive David McLauchlan said. “As the demand from both commercial and retail customers for energy monitoring solutions increases, it makes perfect sense that we look to combine our Buddy Ohm platform with a product that can be found in every building and every space in the world – lighting.”
LIFX initially launched in Melbourne in 2012 and later relocated to San Francisco. It makes wi-fi enabled, multi-coloured smart lighting solutions for homes and offices. The company claims to be selling products in over 100 countries through retailers including Best Buy, Amazon, Officeworks, JB Hi-Fi, Bunnings, Apple Stores, among others. Since 2012, the company has sold over 1.8 million units worldwide, the statement said.
Initially, Buddy will be focused on helping LIFX expand production and later look at expanding the business to new commercial markets, the company said.
LIFX generated A$38.5 million in revenues last year. A Buddy statement said LIFX had been increasing its revenue by between 70 and 100 per cent year on year since 2015. It had raised $16.3 million from investors such as Sequoia Capital, Qualcomm Ventures, and Blackbird Ventures, according to Crunchbase data.
Buddy was originally launched by McLauchlan and Jeffrey MacDuff in Seattle in 2011. The company went public in 2015 as part of a reverse takeover of publicly-listed Australian mining and resources company Potash Minerals. It is still headquartered in Seattle but its parent company is listed on the Australian Stock Exchange.