-- Rayovac will become one of the largest consumer battery companies in
-- Rayovac and Varta Consumer Battery businesses generated $1 billion in
sales in fiscal 2001 and sell products in more than 100 countries.
MADISON, Wis. and HANNOVER, Germany, July 29 /PRNewswire-FirstCall/ --
Rayovac (NYSE: ROV) of Madison, Wis., and Varta AG of Hannover, Germany,
today announced that the companies have signed an agreement to combine Varta's
global consumer battery business with Rayovac. The transaction does not
include Varta's Brazilian joint venture, its automotive or micro-power battery
(Photo: http://www.newscom.com/cgi-bin/prnh/20020716/ROVLOGO )
This all-cash transaction is expected to close in the Fall of 2002 and is
valued at 262 million Euros ($262 million U.S. at current exchange rates).
Rayovac will acquire all of the Varta consumer subsidiaries located outside of
Germany and will become the majority owner of a new joint venture entity that
will conduct all consumer battery operations within Germany.
Closing is subject to Rayovac obtaining the necessary financing, approval
of Varta AG shareholders and other customary closing conditions. Varta's
consumer battery division had 2001 sales of 398 million Euros ($398 million
U.S. at current exchange rates). The Varta consumer battery business
complements Rayovac's global business with minimal geographic overlap.
Rayovac believes the transaction will be accretive in fiscal 2003 and
The transaction is proposed to be financed by a new $675 million bank
credit facility led by Bank of America and Citigroup. Proceeds of the new
credit facility will be used to retire existing bank debt, fund the
transaction and provide for the expanded working capital needs of the larger
"This transaction is the most significant milestone in the history of
Rayovac," said Dave Jones, Rayovac chairman and CEO. "Varta's consumer
battery brands are highly regarded in Europe and Latin America. Their battery
technology and manufacturing/distribution infrastructure are state-of-the-art.
Without question, combining Varta's consumer battery business with Rayovac's
existing businesses will create a much stronger global competitor, selling in
more than 100 countries worldwide. The combination of these businesses
provides a strong platform for market growth, improved customer service and
technology advancements for consumers."
Jones added, "Upon closing this deal, Rayovac will be one of the largest
consumer battery companies in the world with the #1 market position in
Germany, the largest European battery market, #2 overall market position in
Europe, a stronger #1 position in Latin America, excluding Brazil, as well as
the leading value brand in North America. Additionally, we expect Rayovac
will realize significant benefits in the future as the Rayovac and Varta
businesses are combined to strengthen our battery portfolio in important
"With Rayovac's strong track record of innovation and marketing skills, we
believe the Varta consumer battery business will be aligned with a company
that can maximize its full potential," said Dr. Georg Prilhofer, chairman of
Varta AG. "This deal will also allow Varta AG to concentrate our efforts on
our other businesses."
As part of this agreement, Rayovac will be the exclusive worldwide
distributor of micro batteries produced by Varta Microbatterie Gmbh. Varta
Microbatterie will focus its energies on serving its global base of Original
Equipment Manufacturers (OEM) and Original Equipment Suppliers (OES) and
specialty customers and will continue to design and manufacture its extensive
line of micro-battery products.
Varta's state-of-the-art battery product technology is a natural
complement to Rayovac's culture of innovation. Rayovac recently introduced
Maximum Plus(TM) Alkaline batteries, the company's longest-lasting alkaline
batteries ever, and Rayovac's revolutionary In-Cell Charge Control (I-C3)
technology, expected to dramatically reduce the charge time of rechargeable
nickel metal hydride (NiMH) batteries when commercially available.
Varta is an industry leader in batteries specially formulated for high-
drain devices. Varta's specialty, photo and rechargeable batteries offer
advanced technology and performance benefits in many high growth markets.
Varta's high-speed manufacturing process and equipment design is state-of-the-
art, ensuring the highest quality standards. Their superior battery and
device testing capabilities allow extremely rapid product development.
Benefits to Customers
The transaction advances Rayovac's mission to become a technology-focused,
market-driven global consumer products company. Where the Varta consumer
brand has strong recognition, such as in Germany, Europe and Colombia, Rayovac
can leverage that strength and be well positioned for overall market growth.
Rayovac will also capitalize on Varta's European state-of-the-art
manufacturing, packaging and distribution facilities to better serve the
growing needs of global retail customers.
In Europe, Varta consumer battery products are sold in more than 200,000
retail locations and in seven of the top 10 global retailers. Varta is the
top selling brand in Germany, where it holds over 40% of the consumer battery
market and is the top selling brand in Austria, Finland, Croatia and Slovenia.
In Mexico and Colombia, Varta products are sold in more than 100,000 stores.
The European manufacturing, sales, distribution and administration
operations of Varta's consumer battery business will be combined with
Rayovac's existing European operations and will be led by Remy Burel, CEO of
Varta's consumer battery business. Varta's Latin American operations will be
combined with Rayovac's existing Latin American business and led by Luis
Cancio, executive vice president of Rayovac Latin America. Varta's small
consumer battery operation in the U.S. will be integrated into Rayovac North
American operations. Current customer relationships and operational functions
will continue as is.
Facts About Rayovac
Rayovac is one of the world's leading battery and lighting device
companies. The Company also markets the number one selling rechargeable brand
of battery in the U.S. and is the world leader in hearing aid batteries.
Rayovac had fiscal 2001 sales of $616 million and sells in 60 countries around
Headquartered in Madison, Wis., Rayovac offers a wide breadth of products
including alkaline and zinc carbon primary batteries; lithium and zinc air
button cell batteries; rechargeable Nickel Metal Hydride (NiMH) and alkaline
batteries and chargers; and battery-powered lighting products. Rayovac has
manufacturing operations in North America, Latin America and the UK. Rayovac
trades on the New York Stock Exchange under the ROV symbol.
Facts on Varta's Consumer Battery Business
Varta's consumer battery business had FY 2001 sales of 398 million Euros
($398 million US) and 2001 operating results before interest, taxes,
depreciation and amortization (EBITDA) of 38 million Euros ($38 million US).
Varta's consumer battery products are sold in 100 countries worldwide.
Varta consumer battery products include: alkaline and zinc carbon primary
batteries; rechargeable Nickel Metal Hydride (NiMH) batteries; and a wide
assortment of photo; watch; cordless and cellular phone, and video camera
batteries. They also market flashlights.
Rayovac will conduct a live webcast today (July 29, 2002) at 10 a.m. EDT.
To access the webcast, go to the home page of www.rayovac.com or type in the
URL address of http://www.videonewswire.com/event.asp?id=6780 . For those who
cannot participate during the live webcast, it will be archived on the web
Salomon Smith Barney acted as lead advisor to the Company on this
transaction and provided a fairness opinion to the Board of Directors. Banc
of America Securities LLC also acted as financial advisor to the Company.
(*All market shares are based on management estimates on a unit basis.)
Certain matters discussed in this news release, with the exception of
historical matters, are forward-looking statements within the meaning of the
Private Litigation Reform Act of 1995. These statements are subject to a
number of risks, uncertainties and other factors that could cause results to
differ materially from those anticipated as of the date of this release.
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 consumer
batteries, (3) changes in the general economic conditions where we do
business, such as stock market prices, interest rates, currency exchange
rates, inflation and raw material costs, and (4) various other factors,
including those discussed herein and those set forth in the Company's most
recent Form 10Q, Annual Report on Form 10-K and the prospectus supplement for
the Company's most recent offering of its common stock.
RAYOVAC/VARTA ACQUISITION FACT SHEET
RAYOVAC BATTERY DIVISION COMBINED COMPANY
SALES SALES SALES
-- Fiscal 2001 sales -- Fiscal 2001 sales of 398 -- $1 billion in sales
of $616 million million Euros ($398
-- Geographic sales: -- Geographic sales: -- Geographic sales:
-- 73% from North -- 86% from Europe, 14% -- 45% from North
America, 19% from Latin America America, 37%
from Latin from Europe, 18%
America and 8% from Latin
from Europe America
-- Product sales: -- Product sales: -- Product sales:
-- Alkaline 49%, -- Alkaline 50%, Zinc -- Alkaline 50%,
Zinc Carbon Carbon 20%, Rechargeables Zinc Carbon 21%,
22%, Hearing 9%, Photo 7%, Lighting Lighting Products
Aid Batteries Products 6% and Other 8% 8%, Rechargeables
11%, Lighting 7%, Hearing Aid
Products 10%, Batteries 6%,
Rechargeables 5% Photo 3% and Other
and Other 3% 5%
FACTS AND FIGURES FACTS AND FIGURES FACTS AND FIGURES
-- World headquarters -- Main operations in -- World headquarters
in Madison, Wis. Germany in Madison, Wis.,
-- Products sold in -- Products sold in 100 with major
60 countries countries operations in
-- Listed as a public -- Consumer battery products Germany, Europe,
company on the include: alkaline, zinc UK and Latin America
New York Stock carbon/chloride, -- Products sold in
Exchange since rechargeable Nickel more than 100
1997 Metal Hydride (NiMH) and counties
-- Rayovac's main Nickel Cadmium (NiCad), -- Full line of primary
product offerings photo, watch, cordless and secondary
include: Maximum phone, cellular phone batteries, specialty
Plus alkaline and video camera batteries and
batteries, -- Varta markets the number- lighting devices
rechargeables- one-selling battery -- One of the largest
Nickel Metal in Germany -- the consumer battery
Hydride (NiMH) largest European companies in the
and rechargeable market -- Austria, world
alkaline batteries, Finland, Croatia, -- #3 market
1-Hour charger, I-C3 Slovenia and Colombia, position
NiMH batteries that South America in North
can be recharged in America
15 minutes, hearing -- #2 market
aid batteries, zinc position in
batteries, lithium -- #1 market
specialty batteries, position in
and battery-operated Latin America
-- Rayovac markets the
of battery in the
U.S. and is the
world leader in
hearing aid batteries
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SOURCE Rayovac Corporation
Web site: http: //www.videonewswire.com/event.asp?id=6780
CONTACT: John Daggett of Rayovac Corporation, +1-608-275-4912
Photo: NewsCom: http: //www.newscom.com/cgi-bin/prnh/20020729/MNM003 AP Archive: http://photoarchive.ap.org PRN Photo Desk, +1-888-776-6555 or +1-212-782-2840
CAPTION: MNM003 RAYOVAC AND VARTA AGREE TO COMBINE BATTERY BUSINESSES Rayovac (NYSE: ROV) of Madison, Wisconsin, and Varta AG of Hannover, Germany, today announced that the companies have signed an agreement to combine Varta's global consumer battery business with Rayovac. (Pictured left to right): Walther Wever, member of the executive board, Varta AG; Dr. Georg Prilhofer, chairman of the executive board of directors, Varta AG; Dave Jones, chairman and CEO, Rayovac; and Kent Hussey, president and CFO, Rayovac. (PRNewsFoto)[MP] MADISON, WI USA 07/29/2002