Resideo Tech (REZI) Jumps as Firm Slashes $140-Million Annual Obligations

We recently published 10 Stocks With Shocking Surges. Resideo Technologies, Inc. (NYSE:REZI) is one of the best-performing stocks on Wednesday.

Resideo Technologies saw its share prices surge by 16.17 percent on Wednesday to finish at $28.52 apiece as investors took path from a series of developments that will see the company get rid of $140 million in annual obligations and focus on its core business of providing product solutions.

In a statement on Wednesday, Resideo Technologies, Inc. (NYSE:REZI) said that it entered into a definitive agreement with Honeywell International Inc. (NASDAQ:HON) for the one-time payment of $1.59 billion that would terminate a financial agreement agreed upon since 2018, and which has been in effect until 2043. Upon closing of the transaction, Resideo Technologies, Inc. (NYSE:REZI) will be freed from annual obligations worth $140 million.

Resideo Technologies, Inc. (NYSE:REZI) said funds for the payment will come from a combination of $400 million cash on hand and new senior secured debt financing with JPMorgan and Wells Fargo.

In line with the move, the company will also spin off its ADI Global Distribution business which will see the separation of the latter from Resideo Technologies, Inc. (NYSE:REZI). The move is expected to allow the companies to focus on their core businesses.