Newell Brands To Buy New Zealand-based Sistema Plastics For US$470 Mln

(RTTNews) - Newell Brands Inc. (NWL) said it agreed to acquire New Zealand-based Sistema Plastics, a leading provider of innovative food storage containers, primarily under the Sistema brand, for NZ$660 million or US$470 million.

In addtion, the company has entered into a definitive agreement to acquire Smith Mountain Industries, a leading provider of premium home fragrance products, primarily under the WoodWick Candle brand, for $100 million. Both businesses are growing at rates well above Newell Brands' core sales growth rate and are expected to be immediately accretive to normalized earnings.

Newell Brands stated that both acquisitions will be funded from cash on hand at the time of closing. Neither acquisition is expected to draw on the U.S.-based net proceeds from planned divestitures which will be used primarily for accelerated debt repayment as part of the Company's commitment to achieve the stated leverage ratio goal of 3 to 3.5 times EBITDA by the end of 2018.

Both transactions are subject to customary closing conditions, including regulatory approvals in the case of Sistema.

The Sistema transaction is expected to close in the second quarter of 2017, while the WoodWick Candle transaction is expected to close in the first quarter of 2017.

The company has previously announced the intention to divest about 10 percent of its portfolio (about $1.5 billion of annualized revenue), including its Tools business which it has agreed to sell to Stanley Black & Decker for $1.95 billion.

The company expects to complete the divestitures in the first half of 2017. These divestitures and today's announced agreements to acquire the WoodWick and Sistema brands are part of the company's ongoing effort to both simplify and strengthen the portfolio.