Acuity Brands (AYI) to Acquire TLG, Boost Product Offering

Acuity Brands, Inc.’s AYI wholly-owned subsidiary, Acuity Brands Lighting, Inc. has inked a deal to acquire The Luminaires Group (“TLG”) — a leading provider of specification-grade lightening solutions. Although terms of the deal are not yet disclosed, management anticipates the buyout to be completed by the end of the month and be accretive to earnings in fiscal 2020.

How Will TLG Buyout Help Acuity Brands?

TLG sells indoor and outdoor lighting fixtures to commercial, institutional, hospitality and municipal markets through five niche lighting brands namely - a-light, Cyclone, Eureka, Luminaire LED and Luminis. Notably, the latest addition will enhance Acuity Brands’ existing lighting portfolio and customer base.

Acuity Brands’ smart lighting expertise and TLG’s renowned brands, on a combined basis, will provide an extensive customized luminaires solution for customers looking for innovative technology, great design and optimum performance.

Acquisition & Innovation - Key Growth Strategies

Acuity Brands, which shares space with Orion Energy Systems, Inc. OESX, Energy Focus, Inc. EFOI and LSI Industries Inc. LYTS in the Zacks Building Products - Lighting industry, has been expanding geographic borders and product portfolio through acquisitions and joint ventures.

On Jun 20, 2019, it acquired a New Castle, DE-based manufacturer of advanced optical components, WhiteOptics, L.L.C. This acquisition enhanced its optical materials offering to boost the performance of commercial and architectural products. Also, in fiscal 2018, it added Lucid Design Group and IOTA Engineering to enhance the company’s market leadership in this important lighting category.

Acuity Brands’ diversified portfolio of innovative lighting control solutions and energy-efficient luminaries bode well. In fiscal 2018, the company introduced almost 100 product families to its industry-leading portfolio, gaining market share in product categories and sales channels. Its tier 3 and 4 solutions grew more than 20% during the fiscal third quarter.

Notably, Acuity Brands’ Atrius-based IoT luminaires and solutions in the retail segment are becoming the industry standard. The company remains focused on expanding these solutions in other channels as well.

Share Price Performance

This Zacks Rank #3 (Hold) stock has outperformed the industry over the past three months. Acuity Brands’ leading market position, diversified portfolio of innovative lighting control solutions and energy-efficient luminaries are substantial growth drivers. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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