Reckitt Benckiser to start tender offer to buy shares of Schiff Nutrition
Reckitt Benckiser Group Plc said it will start a tender offer today to acquire all the outstanding shares of Schiff Nutrition International, Inc. Schiff Nutrition International, Inc is a leading provider of branded vitamins, nutrition supplements and nutrition bars in the U.S. and elsewhere for $42 a share in cash which would value Schiff at approximately $1.4 billion.
The company’s offer is not dependent on financing as the purchase will be funded from the current facilities. The global consumer goods leader in health, hygiene and home’s offer represents a premium of 23.5% over the $34.00 per share transaction announced on October 30, 2012 by Bayer HealthCare LLC and Schiff.
The London Stock Exchange listed company 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.
The vitamin, minerals and supplements product portfolio of Schiff includes market leading brands in the specialist product category in the U.S., including MegaRed®, the number one in the healthy heart segment, Move Free® , the number 2 in joint care, Airborne®, the number 2 in immune support, and Schiff Vitamins®.
Reckitt Benckiser Chief Executive Officer, Rakesh Kapoor 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.”
Mr. Kapoor also said, “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 U.S. It also plays well to our consumer marketing, innovation and go to market capabilities.” He also stated, “We are confident that the VMS market drivers, notably changing demographics and increased awareness of the health and wellness benefits of the VMS products, will provide significant long-term growth potential in what is currently a very fragmented market.”
The offer to purchase, letter of transmittal and others offering documents will be filed today with the Securities and Exchange Commission.
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 deals with Reckitt Benckiser and to other customary conditions.
Morgan Stanley & Co is acting as exclusive financial adviser to Reckitt Benckiser. Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as Reckitt Benckiser’s legal advisor. Reckitt Benckiser is a global consumer goods leader in health, hygiene and home.
The company has operations in more than 60 countries, with headquarters in the UK, Singapore, Dubai and Amsterdam.