Spectrum Brands Holdings Inc. has announced it will explore strategic options for its Global Batteries & Appliances (GBA) businesses with the intention to sell the units during 2018.
“For nearly 10 years, we have sought to allocate capital efficiently through organic investment, as well as tuck-in and transformational acquisitions, and we will continue to do this going forward,” said David Maura, executive chairman of Spectrum Brands Holdings. “This action to redeploy capital invested from our GBA assets repositions our company into a faster-growing and higher-margin Spectrum Brands, with an increased focus on our four remaining businesses of Hardware & Home Improvement, Global Auto Care, Global Pet Supplies and Home & Garden.
“With greatly increased financial flexibility from these planned divestitures, we intend to reduce debt, reinvest in our core businesses both organically and through acquisitions, and repurchase shares,” Maura continued. ”We believe this strategy is aligned with investors’ interests and will drive shareholder value to the next level. It also reinforces our continuing confidence that Spectrum Brands’ best days are still ahead.”
“The Global Batteries & Appliances businesses are both strong, well-run divisions with excellent management and dedicated employees, and they have consistently contributed to the long-term success of Spectrum Brands,” said Andreas Rouvé, CEO of Spectrum Brands Holdings. ”We have received multiple inquiries from prospective buyers and are in active discussions with several. Given their attractiveness and upside potential, we believe these businesses can have accelerated success in the hands of new owners.”
For the fiscal year ended Sept. 30, 2017, the Global Batteries & Appliances segment generated net sales of $1,998 million, operating income of $231 million and adjusted EBITDA of $317 million. Spectrum Brands reported fiscal 2017 net sales of $5,007 million, operating income of $561 million and adjusted EBITDA of $956 million.
Effective with the company’s fiscal 2018 first quarter financial results ended Dec. 31, 2017, the Global Batteries & Appliances segment will be reclassified as held for sale and reported as discontinued operations.