Helen of Troy
) completed the acquisition of U.S.-based retailer and health
publisher Healthy Directions, LLC and its subsidiaries for a cash
transaction worth $195 million. Healthy Directions will continue to
operate from Bethesda, MD under the current management team. This
takeover will facilitate Helen of Troy's entry into the vitamins,
minerals and supplements (VMS) category.
The Healthy Directions acquisition is expected to be accretive
to revenues by more than 10% on an annualized basis and also affect
cash flow, adjusted EBITDA and adjusted earnings per share
Healthy Directions will bring with it several highly acclaimed
physicians and nutritional experts in heart health, digestive
health, joint health, skin care and vision support into Helen of
Troy's health and wellness category.
The future of the VMS business seems bright becauseaccording to
Nutrition Business Journal, more than 70% of U.S. population aged
55 and above took vitamin supplements in 2013. In addition, the VMS
market is expected to continue growing at a mid-to-high single
digit rate annually through 2020. The acquisition thus seems
beneficial for Helen of Troy.
The Healthy Directions acquisition is a strategic fit for Helen
of Troy currently carrying a Zacks Rank #2 (Buy) as it is geared to
bolster its presence in the health and wellness category. In this
regard, the consumer products company acquired subsidiaries like
Kaz (healthcare devices and home comfort products) in Dec 2010 and
PUR (manufacturer of water purifier) a year later from
The Procter & Gamble Co.
J.P. Morgan Securities LLC of
JPMorgan Chase & Co.
) acted as the financial advisor to Helen of Troy on the
acquisition which was financed by JPMorgan Chase Bank, N.A. and
Bank of America, N.A. of
Bank of America Corp.
). Additionally, Helen of Troy entered into a Fourth Amendment to
its Credit Agreement with Bank of America on Jun 11 to boost the
unsecured revolving commitment of the Credit Agreement from $375
million to $570 million. Not required here..as the acquisition has
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