NEW YORK – Energizer, known best for its infinitely drumming, battery-powered bunny, will buy Playtex for about $1.16 billion to add sun screens, wet wipes and sippy cups to its portfolio, the company said.
Energizer Holdings Inc. is offering $18.30 per share, the company said late Thursday.
The price represents an 18 percent premium over Playtex's closing stock price Thursday. The transaction was approved unanimously by the boards of directors at both companies, Energizer said. Playtex, according federal filings, had 63.46 million shares outstanding as of April 30.
Energizer is also assuming an undisclosed amount of debt in the deal, which it said would boost total purchase price to $1.9 billion.
Energizer is one of the world's largest manufacturers of batteries and flashlights. It is also the parent company of Schick-Wilkinson Sword, the second largest manufacturer of wet shave products in the world.
"Playtex has strong consumer brands, most of which have No. 1 or No. 2 market positions, in stable or growing personal care categories," said Energizer Chief Executive Ward Klein. "Its products enjoy healthy margins with strong, predictable cash flows, similar to our existing stable of consumer and personal care products."
Klein said that the deal may eventually lead to further acquisitions.
"We see Playtex as an exceptionally great fit with Energizer, with similar customers and distribution channels in the U.S. and Canada, and the opportunity for geographic expansion in many other areas of the world where we currently do business," he said. "We also believe there are significant integration and cost reduction opportunities for the combined businesses."
Playtex sales for its most recently reported 12 months through March 2007 totaled $641 million.
Playtex shares closed 2 percent higher at $15.52 Thursday, while Energizer's stock rose $1.56, or 1.5 percent, to $106.73.
Westport, Conn.-based Playtex may be best known for the feminine care products that make up 35 percent of its net sales, but the company acquired Hawaiian Tropic in the spring, boosting an already substantial skin care division. Playtex owns Banana Boat sun screen, and skin care products made up 37 percent of the company's net sales before the recent acquisition.
Neil DeFeo, chairman and chief executive officer of Playtex, said Energizer offered a good premium over the company's share price.
"For our employees, it means becoming a part of a much larger consumer products business with the scale and resources to thrive in an increasingly competitive environment," DeFeo said.