Why VIZIO Holding Shares Are Rocketing Premarket Tuesday

VIZIO Holding Corp VZIO shares are rocketing premarket Tuesday after the company inked an agreement to be acquired by Walmart Inc WMT.

Walmart is acquiring VIZIO for $11.50 per share in cash, equating to a fully diluted equity value of about $2.3 billion.

VIZIO’s Board has unanimously approved the transaction of Directors, and VIZIO has the right to terminate the transaction within 45 days if, subject to the terms and conditions of the merger agreement, VIZIO receives and accepts a “Superior Offer.”

Read: Walmart Eyes Vizio Acquisition to Supercharge Its Smart TV and Advertising Game

Following the closure of the transaction, VIZIO’s business will be included into Walmart’s U.S. segment.

Walmart expects the transaction to be slightly dilutive to EPS in the near term due to certain transaction-related costs associated with the acquisition, including talent retention and technology integration.

The acquisition of VIZIO and its SmartCast Operating System (OS) is projected to help Walmart connect with and serve its customers in new ways, including innovative television and in-home entertainment and media experiences. 

Related: Walmart-Vizio Deal: A Potential Boon Or Bane For Roku? Analysts Sound Off Before Q4 Earnings

Seth Dallaire, executive vice president and chief revenue officer, Walmart U.S. said, “We believe VIZIO’s customer-centric operating system provides great viewing experiences at attractive price points. We also believe it enables a profitable advertising business that is rapidly scaling. Our media business, Walmart Connect, is helping brands create meaningful connections with the millions of customers who shop with us each week.”

VIZIO plans to report fourth quarter and full year 2023 results on February 27.

Also See: Walmart Q4 Performance: Revenue And EPS Surprise, Dividend Hike, VIZIO Buyout And More

Price Action: VZIO shares are up 15.32% at $10.99 premarket on the last check Tuesday.