Zagg (ZAGG), a mobile device accessory manufacturer based in Salt Lake City, will acquire rival Mophie for $100 million, the companies announced on Tuesday.
Tustin, Calif.-based Mophie is best known for making “Juice Pack” phone cases with batteries embedded in them to allow for extended use.
The combined company will become the leader in battery cases, external batteries, screen protection, and tablet keyboards. Its combined 2015 sales total about $470 million.
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There are two ideas driving the deal, Zagg CEO Randy Hales said: portfolio diversification and operational efficiencies. “We see numerous opportunities to drive revenue growth and increase profitability by leveraging the strengths of both organizations to strengthen product development, improve brand presence, and expand distribution,” he said in a statement.
But there’s also another big one: competition. Manufacturers of the devices themselves, such as Apple (AAPL), have begun manufacturing cases and other accessories for their phones, pressuring third-party providers such as Zagg and Mophie. (Apple currently sells iPhone cases and protection accessories by 20 other companies.) The combined company has more leverage to negotiate in such a situation.
The deal is expected to close in the first quarter of 2016. Mophie CEO Daniel Huang will keep his role but report to Hales.