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Reckitt Benckiser To Commence All-Cash Tender Offer To Acquire Schiff Nutrition For $42 Per Share
By: PR Newswire
Nov. 15, 2012 05:35 PM
-- Acquisition to Provide Reckitt Benckiser a Significant Opportunity to Enter Large and Growing Vitamins, Minerals and Supplements Market
-- Cash Offer Represents 23.5% Percent Premium to Announced Bayer Group Transaction And Tender Offer Can Close by Year-End
SLOUGH, England, Nov. 15, 2012 /PRNewswire/ -- Reckitt Benckiser Group PLC ("Reckitt Benckiser") (LSE: RBL) today announced that it will commence a tender offer tomorrow, November 16, 2012 to acquire all of the outstanding shares of Schiff Nutrition International, Inc. ("Schiff") (NYSE: SHF), a leading provider of branded vitamins, nutrition supplements and nutrition bars in the United States and elsewhere, for $42.00 per share in cash valuing Schiff at approximately $1.4 billion. Reckitt Benckiser's offer is not dependent on financing as the purchase will be funded from existing facilities.
Reckitt Benckiser's offer represents a premium of 23.5 percent over the $34.00 per share transaction announced on October 30, 2012 by Bayer HealthCare LLC ("Bayer") and Schiff. Reckitt Benckiser is confident that it can close the tender offer before the end of calendar year 2012, provided it is permitted in short order to complete limited confirmatory due diligence.
Schiff's vitamin, minerals and supplements (VMS) product portfolio includes a number of market leading brands in the specialist product category in the USA, including MegaRed®, number 1 in the healthy heart segment, Move Free® the number 2 in joint care, Airborne® the number 2 in immune support, and Schiff Vitamins®.
Rakesh Kapoor, Reckitt Benckiser Chief Executive Officer, said, "For Reckitt Benckiser, this acquisition would provide a powerful entryway into the large and rapidly growing $30 billion global VMS market. This market would be the largest consumer health care sector in which we operate. It is an ideal addition to Reckitt Benckiser's new strategic focus in global health and hygiene, and would give us immediate scale in VMS in the USA. It also plays well to our consumer marketing, innovation and go to market capabilities."
He continued, "We are confident that the VMS market drivers, notably changing demographics and increased awareness of the health and wellness benefits of VMS products, will provide significant long-term growth potential in what is currently a very fragmented market."
"We firmly believe that our entrepreneurial and consumer-focused mindset, our infrastructure, speed and scale, combined with Schiff's leading brand portfolio, will generate sustained value for our shareholders," he said.
Based on the financial information disclosure dated October 29, 2012 and made public in its 14C SEC filing on November 5, 2012, Schiff expects to achieve net sales of $385 million and proforma EBITDA of $84.6 million for the fiscal year ending May 31, 2013. Reckitt Benckiser expects the transaction will result in significant synergies and that it would be immediately accretive to earnings on an adjusted basis.
Reckitt Benckiser sees no reason why this tender offer could not close before year end, assuming prompt due diligence, and it will be prepared to sign a merger agreement substantially similar to the one Schiff currently has with Bayer. Reckitt Benckiser looks forward to engaging with Schiff's Board and is confident that they will recognize it as a superior proposal.
The Offer to Purchase, Letter of Transmittal and other offering documents will be filed tomorrow, November 16, 2012, with the Securities and Exchange Commission. Investors and stockholders of Schiff may obtain copies of all of the offering documents free of charge at the Securities and Exchange Commission's website (www.sec.gov). Reckitt Benckiser's offer will be subject to Schiff and its controlling stockholders terminating their merger and related agreements with Bayer and entering into definitive agreements with Reckitt Benckiser, and to other customary conditions, including the tender of a majority in voting power of Schiff shares of common stock, all of which will be set forth in the offering documents to be filed. Reckitt Benckiser believes it can promptly obtain any necessary regulatory approvals, including approval under the Hart-Scott-Rodino Antitrust Improvements Act (HSR Act).
Morgan Stanley & Co. Limited is acting as exclusive financial adviser to Reckitt Benckiser and no one else in connection with the matters described in this announcement. In connection with such matters, Morgan Stanley & Co. Limited, its affiliates and their respective directors, officers, employees and agents will not regard any other person as their client, nor will they be responsible to any other person for providing the protections afforded to their clients or for providing advice in relation to the transaction, the contents of this announcement or any other matter referred to herein.
Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as Reckitt Benckiser's legal advisor.
Conference Call Information
Participants can access the call by dialling :
Conference ID: 72072243
A replay of the conference call can be accessed via :
Conference ID: 72072243
Available from: 16 Nov 2012 08:30 GMT to 15 Dec 2012 08:30 GMT
A recording of the conference call will be available on http://www.rb.com/
About Reckitt Benckiser
RB people and its culture are at the heart of the company's success. They have an intense drive for achievement and a desire to outperform wherever they focus, including in CSR where the company has reduced its carbon footprint by 20% in 5 years and is now targeting to deliver a 1/3 reduction in water use, 1/3 further reduction in carbon and have 1/3 of its net revenue coming from more sustainable products by 2020. It is also the Save the Children charity's largest FMCG global partner.
The company has operations in over 60 countries, with headquarters in the UK, Singapore, Dubai and Amsterdam, and sales in almost 200 countries. The Company employs approximately 32,000 people worldwide.
For more information visit http://www.rb.com/
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