Empower Brands presented a non-binding proposal to Helen of Troy’s board of directors to acquire all outstanding common equity for $37 per share after not reaching an agreement privately. That would put Helen of Troy — which operates brands such as Hydro Flask, Osprey and OXO — at an implied enterprise value of about $1.6 billion.
An affiliate of Empower Brands already owns about 4.5% of the company’s outstanding shares, according to a Wednesday press release. Empower Brands is a joint venture by Spectrum Brands and Oaktree Capital Management. Its portfolio includes Black+Decker, Remington and more.
Helen of Troy did not immediately respond to Retail Dive’s request for comment on the proposal.
“We believe our all-cash proposal offers Helen of Troy’s shareholders compelling and certain value at an attractive premium,” David Maura, chairman and CEO of Spectrum Brands, and chairman of Empower Brands, said in a statement. “Rather than substantively engaging with us about a transaction, Helen of Troy has attempted to halt any process by requiring us to enter into an overly restrictive agreement that would limit our ability to communicate our offer to the Helen of Troy shareholders. We remain willing to enter into a constructive dialogue that could potentially support an improved Proposal and lead to consummating a friendly transaction.”
The jointly-owned consumer products group believes a combination with Helen of Troy’s portfolio would be complementary and improve operational efficiency.
Empower Brands began engaging privately with Helen of Troy in July about its acquisition interest, ultimately increasing its initial proposal offer in October and requested a discussion between both parties’ financial advisors.
Empower Brands’ adviser, UBS, was informed by Bank of America, who worked for Helen of Troy, late last month that sharing any information would be “subject to a confidentiality agreement restricting Empower Brands’ ability to, among other things, publicly disclose its interest in the company and its proposal,” per a U.S. Securities and Exchange Commission filing Wednesday.
Empower Brands says Helen of Troy’s board has overseen “the destruction of substantial shareholder value through a series of operational, financial and strategic failures.” It listed Helen of Troy’s share price decline over the past five years and its acquisition decisions as part of its case.
Helen of Troy’s second quarter net sales jumped 2.1% year over year to $440.9 million, per a release last month. Growth in its home and outdoors brands was partly offset by declines in the beauty and wellness business. It swung from a net loss of $308.6 million in the same period last year to a net income of $4.6 million.
