MADISON, Wis., Aug. 9 /PRNewswire/ -- Rayovac Corp. (NYSE: ROV) today
announced it has completed the acquisition of the consumer battery operations
of ROV Limited for $155 million. With this acquisition, Rayovac has
consolidated control of "Rayovac" brand rights for battery products worldwide,
with the exception of Brazil, and setting the stage for a major global
marketing launch. The acquisition rejoins the Latin American battery
manufacturing and marketing operations with Rayovac Corp., which had been its
parent company prior to a 1982 spin-off. It also significantly adds to the
company's marketing opportunities in Latin America, the Middle East, Africa
and select Asian countries.
"This acquisition represents a significant milestone in our strategy to
become a world-class global battery company," said Dave Jones, Rayovac
Chairman and CEO. "With the addition of Mexico, Central America, the
Dominican Republic and much of South America, we have added a large
established consumer base. In addition, the acquisition of Rayovac brand
rights in other areas provides us with major global penetration potential. I
am very excited about introducing our unique blend of high quality and value
priced products to consumers worldwide. I expect that the acquisition should
be accretive in the first year."
To facilitate a smooth transition and help grow the Latin American
business, Rayovac has announced the formation of a Latin American management
team. Heading the operations will be Luis Cancio, Senior Vice
President-General Manager. Prior to joining Rayovac, Cancio was a top
executive with XCELL Group LLC, a Connecticut based private investment firm
where he was a founding principal. Prior to that he held several senior level
positions at Duracell, including overall responsibility for operations
throughout Latin America.
"Over the next several months, we will be evaluating all our domestic and
international operations and focusing our efforts on implementing cost
efficiencies on a global scale," said Jones. "It is anticipated that we will
take a one time charge later this quarter to allow these restructuring
initiatives to take place. The result should allow Rayovac to improve its
overall efficiencies, cost structure, and competitiveness over the next
several years. We continue to be deeply committed to the value brand strategy
that has led to the significant market share and revenue gains recognized
since Rayovac's transformation in 1996."
Rayovac entered into new senior credit facilities with a banking syndicate
led by Bank of America to finance the entire acquisition and to refinance debt
outstanding under Rayovac's existing bank facilities. Rayovac has obtained
amendments to the indenture governing its 10 1/4 percent Series B Senior
Subordinated Notes to facilitate its growth.
Rayovac's transformation began with a successful IPO in November 1997.
Since then, the company has been involved with four acquisitions, launched an
intensive marketing campaign featuring Michael Jordan and achieved ambitious
financial goals. Most recently, the company announced its seventh consecutive
quarter of record sales and earnings.
Rayovac is the third largest U.S. manufacturer of batteries. According to
data provided by A.C. Nielsen, Rayovac is the fastest growing U.S. battery
company and also markets the number one selling domestic rechargeable brand.
The company also is the world leader in hearing aid batteries.
ROV Limited was created in 1982 when Rayovac's then owner, Inco Limited,
divested itself of certain international operations. Prior to the acquisition
by Rayovac, ROV Limited was a privately held firm with significant market
shares in a number of markets in Latin America. The company recorded 1998
sales of $97 million worldwide.
Certain statements contained in this release are forward-looking
statements. These statements involve risks and uncertainties, and actual
results could differ materially from the Company's present expectations.
Certain of the factors that could cause such material differences are set
forth in the Company's Form 10-K for the year ended September 30, 1998 filed
under the Securities Exchange Act of 1934. The company undertakes no
obligation to update or publish in the future any forward-looking information.
SOURCE Rayovac Corporation
CONTACT: John Daggett of Rayovac Corporation, 608-275-4912