ATLANTA--(BUSINESS WIRE)--Sept. 28, 2007--Spectrum Brands, Inc.
(NYSE: SPC) announced today that it has signed a definitive agreement
to sell the Canadian division of its Home & Garden business segment,
which operates under the name Nu-Gro, to a new company formed by
RoyCap Merchant Banking Group and Clarke Inc. (TSX:CKI). This division
is a leading supplier in the Canadian Home & Garden industry, with FY
2006 sales of approximately $100 million across a broad range of
product categories, including fertilizer, grass seed, controls and ice
melt, under brand names such as CIL, Wilson, and Alaskan Ice Melter.
The transaction is anticipated to close by October 31, 2007, subject
to certain regulatory approvals. Financial terms were not disclosed.
Kent Hussey, Spectrum Brands' Chief Executive Officer, commented,
"The Canadian division of our Home & Garden business segment is a
valuable business that enjoys strong consumer recognition, a national
distribution network and a broad and loyal customer base, and we are
pleased to have found in the RoyCap / Clarke partnership a buyer that
is a good fit for this asset. Following the sale of this division,
which was not a profit contributor in our most recent fiscal year,
Spectrum's remaining U.S.-based Home & Garden business will be a more
sharply focused company with improved operating margins and returns on
Net proceeds from the sale will be utilized to reduce outstanding
debt, a key strategic priority for Spectrum Brands. The company
currently estimates that the sale will reduce FY 2008 peak seasonal
borrowing needs by approximately $45 million as a result of cash
proceeds from the transaction and the elimination of the working
capital requirement for the Canadian Home & Garden business in the
2008 lawn and garden selling season.
National Bank Financial Inc. and Sutherland, Asbill & Brennan LLP
served as advisors to Spectrum Brands on the transaction.
Forward Looking Statements
Certain matters discussed in this news release, with the exception
of historical matters, may be forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
statements are subject to a number of risks and uncertainties that
could cause results to differ materially from those anticipated as of
the date of this release, including risks and uncertainties related to
the closing of the sale and the future performance and borrowing needs
of Spectrum Brands' Home & Garden business. Actual results may differ
materially from these statements as a result of (1) changes in
external competitive market factors, such as introduction of new
product features or technological developments, development of new
competitors or competitive brands or competitive promotional activity
or spending, (2) changes in consumer demand for the various types of
products Spectrum Brands offers, (3) changes in the general economic
conditions where Spectrum Brands does business, such as interest
rates, currency exchange rates, inflation, consumer spending and raw
material costs, (4) the company's ability to successfully implement
manufacturing, distribution and other cost efficiencies, (5) the
ability of each party to the proposed sale to satisfy the respective
closing conditions, and other restructuring initiatives, and various
other factors, including those discussed herein and those set forth in
Spectrum Brands' securities filings, including the most recently filed
Annual Report on Form 10-K and Quarterly Report on Form 10-Q.
The company also cautions the reader that undue reliance should
not be placed on any forward-looking statements, which speak only as
of the date of this release. Spectrum Brands undertakes no duty or
responsibility to update any of these forward-looking statements to
reflect events or circumstances after the date of this report or to
reflect actual outcomes.
About Spectrum Brands
Spectrum Brands is a global consumer products company and a
leading supplier of batteries, portable lighting, lawn and garden
products, household insect control, shaving and grooming products,
personal care products and specialty pet supplies. Spectrum Brands'
products are sold by the world's top 25 retailers and are available in
more than one million stores in 120 countries around the world.
Headquartered in Atlanta, Georgia, Spectrum Brands generated net sales
of $2.5 billion in fiscal 2006 and has approximately 7,500 employees
worldwide. The company's stock trades on the New York Stock Exchange
under the symbol SPC.
About RoyCap Merchant Banking Group
RoyCap Merchant Banking Group ("RoyCap") is a division of Royal
Capital Management Corp., a private Toronto based investment company.
RoyCap specializes in returning companies to sustainable, long-term
profitability by making value added investments and combining hands-on
restructuring expertise with a strong, committed management team.
About Clarke Inc.
Clarke Inc. is the Halifax-based parent company of a number of
wholly-owned operating companies and divisions, and is an activist
catalyst investor with a diversified portfolio of strategic and
opportunistic investments. Clarke's operating companies are in the
transportation services business. From time to time, Clarke also
participates in joint ventures when they offer the opportunity to
create shareholder value. Led by George Armoyan and an entrepreneurial
team of professionals focused on uncovering and creating value, Clarke
invests in undervalued businesses and participates actively where
necessary to enhance performance and increase returns. In 2006 alone,
Clarke delivered a shareholder return on investment, including
dividends, of 33%. Clarke's securities trade on the Toronto Stock
Exchange (CKI, CKI.DB, CKI.DB.A); for more information about Clarke,
please visit our website at www.clarkeinc.com.
CONTACT: Spectrum Brands
VP Investor Relations
Victoria Hofstad or Jamie Tully
Sard Verbinnen & Co for Spectrum Brands
SOURCE: Spectrum Brands