Church & Dwight Co., Inc. (NYSE:CHD) has signed a definitive agreement to acquire Avid Health, Inc. (Avid), the leader in gummy form vitamins and supplements, for $650 million in cash. The transaction, which is subject to regulatory approval and other customary conditions, is expected to close early in the fourth quarter.
Avid’s net sales for the trailing twelve months through June 30, 2012 were approximately $230 million. Avid’s major brands are VITAFUSION, the #1 brand in adult gummy form vitamins and L’IL CRITTERS, the #1 brand in children’s gummy form vitamins.
“The acquisition of Avid’s gummy vitamins business represents a great addition to our existing portfolio and brings to our Company a new growth platform in one of the fastest-growing segments of the attractive vitamin / mineral / supplement category. It is also consistent with our strategy of strengthening our business by adding #1 or #2 brands in areas of high growth potential,” said James R. Craigie, Chairman and Chief Executive Officer of the Company.
Avid’s trailing twelve months EBITDA through June 30, 2012 was approximately $58 million. Once Avid is fully integrated, the Company expects to leverage its distribution network, operating discipline, and support functions, to generate anticipated annual cost savings of approximately $15 million in 2014. Avid Health’s manufacturing facilities are based in Vancouver, Washington.The acquisition is structured as a stock purchase that the Company expects to finance with a combination of debt and cash. The acquisition is expected to be dilutive to 2012 earnings per share (approximately $0.02 per share) and accretive to both earnings and free cash flow in 2013, inclusive of transaction costs, acquisition-related expenses, the effect of an inventory step-up charge and intangible amortization expense. Mr. Craigie added, “We continue to expect diluted earnings per share for 2012 to be in the range of $2.41 to $2.43, excluding the ($0.02 EPS) dilutive effect of the Avid acquisition. Including Avid, the expected earnings range for 2012 is $2.39 to $2.41.”
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV