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Get filing alertsResideo sets Aug 3 spin-off of ADI Global Distribution; ADI raises $1.5B in debt
Filed July 1, 2026 · Period ending June 30, 2026 · ~2 min read
Key Changes
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Board approved spin-off of ADI Global Distribution business into standalone public company; shareholders of record July 20 receive 1 ADI share per 2 REZI shares held, distribution Aug 3, tax-free to holders.
Item 7.01 — Regulation FD Disclosure verify on EDGAR → -
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ADI completed $400M senior notes offering at 7.125% (2034 maturity) and entered $1.1B senior secured credit facility ($600M senior secured term loan at SOFR+2.75%, $500M revolver); proceeds fund ~$900M dividend to Resideo, secured by a first-priority lien on substantially all assets of the borrower and guarantors.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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ADI's credit facility requires leverage ratio starting at 4.75:1.00, stepping down to 3.50:1.00 over nine quarters, and minimum interest coverage of 2.50:1.00; term loan requires 50% excess cash flow prepayments starting 2027.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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When-issued trading for ADI begins July 29 under "ADIG WI"; REZI will trade in dual markets (with/without distribution rights) July 29–Aug 3; ADI regular trading starts Aug 4 under "ADIG".
Exhibit 99.1 view on EDGAR → -
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Spin-off remains subject to closing conditions in Separation and Distribution Agreement; if not completed by Dec 31, 2026, senior notes redeem at par plus accrued interest.
Item 7.01 — Regulation FD Disclosure verify on EDGAR →
Summary
Resideo is executing a major corporate restructuring, separating its ADI Global Distribution business into an independent public company. Shareholders holding REZI stock on July 20, 2026 will receive one share of the new ADI Global Distribution (ticker: ADIG) for every two Resideo shares they own, with the distribution occurring August 3.
The transaction is structured as tax-free to shareholders and requires no shareholder vote. To capitalize the spun-off entity, ADI raised $1.5 billion through a $400 million senior notes offering at 7.125% and a $1.1 billion senior secured credit facility. These proceeds will fund an approximately $900 million one-time dividend to Resideo, representing partial consideration for the transferred business.
ADI will emerge as a standalone company carrying significant debt: the credit agreement imposes a leverage covenant starting at 4.75:1.00 and stepping down to 3.50:1.00 over nine quarters, plus mandatory excess cash flow sweeps of 50% starting in 2027. This debt load will constrain ADI's financial flexibility and direct free cash flow toward deleveraging in its early years as a public company. For Resideo holders, the spin creates two separate investment decisions where there was one. The transaction allows each business to pursue its own strategy and capital allocation, but also introduces execution risk as both entities establish standalone operations. Investors should monitor the July 13–14 Investor Days for management's standalone financial outlooks and assess whether the combined value proposition justifies holding both entities post-separation, secured by a first-priority lien on substantially all assets of the borrower and guarantors.
Section-by-Section Diff
Event · Item 1.01 — Entry into a Material Definitive Agreement
Item 1.01 — Entry into a Material Definitive Agreement filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
The net proceeds of the borrowings under the Term Facility, together with a portion of the proceeds of the issuance of the Notes, will be used to pay a one-time cash dividend to the Company in the amount of approximately $900 million as partial consideration for contribution of the ADI Global Distribution business by the Company to ADIG in connection with the Spin-Off, to pay costs and expenses incurred in connection with the transactions and for general corporate purposes.
Resideo will receive approximately $900 million as a one-time dividend from the spin-off entity, funded by the term loan and a portion of the notes proceeds. This represents partial consideration for transferring the ADI Global Distribution business to the spun-off entity.
Added in current filing · verify on EDGAR →
ADI Funding will be required to make prepayments on the Term Facility, starting with the fiscal year ending on December 31, 2027, equal to 50% of excess cash flow on an annual basis (with step-downs to 25% and 0% subject to satisfaction of certain consolidated total net leverage ratios), subject to thresholds, exceptions and terms and conditions customary for financings of this kind.
The term loan requires mandatory prepayments of 50% of excess cash flow annually starting in 2027, stepping down to 25% or 0% if leverage targets are met. This provision will direct the spun-off entity's free cash flow toward debt reduction.
Event · Item 7.01 — Regulation FD Disclosure
Item 7.01 — Regulation FD Disclosure filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
the Company announced that its board of directors (the “Board”) has formally approved the Spin-Off of the Company’s ADI Global Distribution business into an independent, publicly traded company named “ADI Global Distribution Inc.” and approved a record date of July 20, 2026 (the “Record Date”) for the pro rata distribution (the “Distribution”) of all of the issued and outstanding common shares of ADIG to the holders of Company common stock as of the close of business on the Record Date (the “Eligible Holders”).
Resideo's board has formally approved the separation of its ADI Global Distribution business into a standalone public company. This represents a major corporate restructuring that will split the company into two independent entities, allowing each to pursue its own strategic priorities and capital allocation.
Added in current filing · verify on EDGAR →
The shares of ADIG are expected to be delivered at 5:00 p.m. (eastern time) on August 3, 2026 (the “Expected Distribution Date”) and the Distribution will be deemed effective as of 12:01 a.m. (eastern time) on August 3, 2026. On the Expected Distribution Date, the Eligible Holders are expected to receive one share of ADIG common stock for every two shares of the Company common stock they hold as of the close of business on the Record Date.
Shareholders holding REZI stock as of July 20, 2026 will receive one share of the new ADI Global Distribution company for every two shares of Resideo they own. The distribution is expected to occur on August 3, 2026. This is a tax-free distribution to shareholders, effectively giving them ownership in both the remaining Resideo business and the spun-off distribution business.
Added in current filing · verify on EDGAR →
Completion of the Distribution and the Spin-Off is subject to, among other things, the satisfaction or waiver of certain closing conditions as set forth in the form of Separation and Distribution Agreement filed with the U.S. Securities and Exchange Commission as part of the registration statement on Form 10 filed with the SEC by ADIG.
The spin-off is not yet final and remains subject to closing conditions detailed in the Separation and Distribution Agreement. While the board has approved the transaction and set key dates, investors should be aware that certain conditions must still be satisfied or waived before the distribution occurs.
Event · Exhibit 99.1
Added in current filing · view on EDGAR →
The Board also has set a record date of July 20, 2026 (the “Record Date”) and a distribution date of August 3, 2026 in connection with the Spin-Off. ... The distribution will occur at 5:00 p.m., eastern time, on August 3, 2026 (the “Distribution Date”), on the basis of a distribution ratio of one share of ADI common stock for every two shares of Resideo common stock held as of the close of business on the Record Date.
Resideo's Board formally approved the spin-off of ADI Global Distribution and set key dates: shareholders of record on July 20, 2026 will receive one ADI share for every two Resideo shares owned, with distribution occurring August 3, 2026. ADI will begin trading on NYSE under ticker "ADIG" on August 4, 2026. No shareholder vote is required, and the transaction is expected to be tax-free for U.S. federal income tax purposes except for fractional shares.
Added in current filing · view on EDGAR →
Resideo anticipates that ADI common stock will begin trading on the NYSE under the ticker symbol “ADIG WI” on a “when-issued” basis on or about July 29, 2026. ... However, beginning on July 29, 2026 and continuing through August 3, 2026, it is expected that there will be two markets in Resideo common stock on the NYSE: a “regular-way” market under Resideo’s current ticker symbol “REZI,” in which Resideo shares will trade with the right to receive shares of ADI common stock on the Distribution Date, and an “ex distribution” market under the ticker symbol “REZI WI”, in which Resideo shares will trade without the right to receive shares of ADI common stock on the Distribution Date.
Starting around July 29, 2026, ADI shares will trade when-issued under "ADIG WI" and Resideo will have dual markets: "REZI" (with ADI distribution rights) and "REZI WI" (without rights). This creates a brief period where investors can trade positions with or without the spin-off entitlement before the August 3 distribution. Shareholders are advised to consult financial advisors on trading implications.
Added in current filing · view on EDGAR →
As previously announced, Resideo and ADI will host Investor Days in New York City on July 13, 2026, and July 14, 2026, respectively. Both events will take place at the New York Stock Exchange and will include management presentations, product showcases and Q&A sessions with executive management. During the events, members of the leadership teams will provide details on Resideo’s and ADI’s standalone businesses, longer-term financial outlooks and respective value creation strategies.
Resideo and ADI will hold separate Investor Days on July 13-14, 2026 at the NYSE, featuring management presentations on each company's standalone strategy, financial outlook, and value creation plans. Live webcasts and presentation materials will be available on Resideo's investor relations website, with replays posted afterward. These events will provide investors with detailed information on both entities before the spin-off.
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Figures/quotes linked to EDGAR · Narrative written by AI · Jul 1, 2026 · How we verify