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Spectrum Brands (SBH) to Acquire Rejuvenate for $300 Million

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Spectrum Brands Holdings, Inc. (SBH - Free Report) continues to be dedicated toward providing exceptional customer services by boosting its assortments. Progressing along these lines, this leading consumer products and home essentials company entered into an agreement to acquire For Life Products, LLC, (“Rejuvenate”). Known for its strong household cleaning, maintenance and restoration product offerings, Rejuvenate is a worthwhile inclusion to Spectrum Brands’ portfolio. Let’s take a closer look at this latest development.

Rejuvenate Buyout to Bolster Home Essentials Offerings

Spectrum Brands will be acquiring Rejuvenate at a price of approximately $300 million. The transaction, which is subject to customary adjustments, is likely to close in the first half of 2021.

Rejuvenate offers a healthy portfolio of fast-growing innovative cleaning and surface care products for the entire home. Its strong footing in the household cleaning products space is likely to further enhance Spectrum Brands’ ability to meet rising demand for cleaning products. Markedly, household essentials and cleaning products have been witnessing strong growth amid the pandemic, owing to increased time spend indoors as well as enhanced focus on hygiene and well-being. Amid such a scenario, Spectrum Brands move to bolster household essentials offerings through the buyout of Rejuvenate looks quite prudent.

Moreover, Rejuvenate has been witnessing strong top- and bottom-line growth in the past few years. The acquisition is suitably aligned with Spectrum Brands strategy of incorporating strong, complimentary brands that will help leveraging the company’s efficient supply chain and drive strong customer relationships. Through this buyout, the company expects to boost revenues, supply chain capabilities as well as gain manufacturing synergies. In addition, the acquisition is margin accretive for the company.

Rejuvenate will form a part of Spectrum Brands’ Home & Garden division which offers a distinct combination of brands, facilitating an enjoyable home. Notably, sales in this division advanced 79.3% to $82.3 million during first-quarter fiscal 2021.

Prudent Acquisitions & Other Strategic Growth Efforts

Speaking of buyouts, Spectrum Brands acquired Omega Sea, which forms a part of its Global Pet Care portfolio of aquatic brands. The company is progressing well with the integration process of Omega Sea, which is likely to help it tap into aquatic and reptile pet’s space. Moreover, the company is making efforts to strengthen dog chews category via the acquisition of Armitage Pet Care. It is also committed toward driving innovations to boost portfolio offerings

Additionally, the company is progressing well with its Global Productivity Improvement Plan that aims to improve operating efficiency and effectiveness. Encouragingly, it raised the savings target for the global productivity improvement plan to $150 million. Majority of these savings are expected to be reinvested into growth initiatives. Moreover, the company’s well-chalked strategies to boost brand awareness, investments in advertising and marketing as well as developing a strong supply-chain network are encouraging. Such efforts suitably position the company for growth in the forthcoming periods.

Shares of this Zacks Rank #3 (Hold) company have gained 13.1% in the past three months against the industry’s decline of 32.8%.

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