Newell Brands Inc., the Hoboken-based consumer goods company, announced Monday that it has reached definitive agreements to acquire a pair of companies for approximately $570 million in total.The first deal, for New Zealand-based Sistema Plastics, will cost Newell about $470 million and add to its line of innovative food storage containers. Sistema, which sells products primarily under the Sistema brand, has annual sales of about $145 million and operates in many major markets where Newell’s Rubbermaid products are not available, the company said in a news release.
The second, for Virginia-based Smith Mountain Industries, will cost Newell $100 million and add to its line of home fragrance products. Smith Mountain’s WoodWick Candle brand has annual sales of about $65 million, Newell said, and offers a strong fit with its Yankee Candle brand.
“These two bolt-on acquisitions strengthen our leadership positions in three of our most important ‘Win Bigger’ categories, food storage, beverage and home fragrance,” Newell CEO Michael Polk said in a prepared statement. “We will apply our advantaged Newell Brands capabilities and scale to further both businesses’ already-strong performance.”
The Sistema deal is expected to close in the second quarter of 2017, while the Smith Mountain deal is expected to close in the first quarter. Newell will fund both deals from its cash on hand and did not draw on expected U.S. proceeds from selling assets, it said.
Newell said the deals are part of an ongoing effort to both strengthen and simplify its portfolio.
“We have a proven track record of accelerating the growth of businesses that we acquire in our core categories,” Newell President Mark Tarchetti said in a statement. “Sistema and WoodWick are both design- and innovation-driven brands that are already generating very strong top-line growth and highly attractive margins. We look forward to integrating these brands into our portfolio as we continue to reshape our company to deliver transformative value creation.”
Newell added that Cameron Partners Ltd. and Rothschild Inc. served as its financial advisers in the Sistema deal.
