ST. LOUIS (AP) – The Energizer Bunny is taking on skin care products, wet wipes and sippy cups. Energizer Holdings Inc., known for its infinitely running bunny, will buy Playtex Products Inc. for $1.16 billion as the company expands its portfolio of personal care products.

Investors liked the news: Playtex shares soared 15.7 percent, or $2.44, to $17.96 in afternoon trading. Energizer shares rose almost 1 percent, or $1.04, to $107.77.

St. Louis-based Energizer is offering $18.30 per share for Playtex Products Inc., the companies said in announcing the deal late Thursday. The price represents an 18 percent premium over Playtex’s closing stock price Thursday.

Westport, Conn.-based Playtex may be best known for the feminine care products that make up 35 percent of its net sales, but it acquired Hawaiian Tropic in the spring, boosting an already substantial skin care division. Playtex owns Banana Boat sun screen, and skin care products made up 37 percent of net sales before the recent acquisition.

Energizer’s purchase of Playtex does not include Playtex Apparel Inc., a separate company that makes bras and other apparel.

The announcement was a surprise to some analysts, much like the 2003 deal when Energizer – among the world’s largest makers of flashlights and batteries, long touted by an advertising bunny that “keeps going and going” – purchased Schick-Wilkinson Sword, the world’s second-largest maker of wet shave products.

That worked out well. Energizer Chief Executive Officer Ward M. Klein said Friday that Schick’s annual sales of $625 million at the time of the purchase have grown to nearly $1 billion. And he expects Playtex to be a good fit with the Schick line, taking personal care products from less than one-third of total corporate sales to more than 40 percent.

Klein said Energizer was interested in a merger partner with brands at the top of their categories. Playtex fits the bill, he said – a loyal customer base with many products ranking first or second.

“We are excited about this acquisition and the quality brands that will be added to our portfolio,” Klein said.

Analyst John Meara of Argent Capital in suburban St. Louis noted Energizer’s strong working relationship with Wal-Mart Stores Inc., the world’s largest retailer, a relationship he said will benefit the Playtex products.

“When they bought Schick there was substantial execution risk, going after a big competitor. And what did they know about the razor business? But they made me a believer. They’ve done a great job,” Meara said.

Deutsche Bank Securities Inc.’s Bill Schmitz Jr., in a research note on Friday, called the deal “strategically sound for Energizer, which needs to diversify beyond batteries.”

Oppenheimer & Co.’s Linda Bolton Weiser wrote that the deal makes strategic sense because Energizer’s two main product lines – batteries and shaving products – are both high-margin with predictable cash flow. Playtex personal care businesses “have those characteristics, and similar retail customers,” Weiser wrote.

Klein said Energizer sees “significant integration and cost reduction opportunities,” but declined to say if jobs would be affected. Energizer employs 14,000 workers. Playtex has 1,800 employees.

The transaction was approved unanimously by the boards of directors at both companies, Energizer said. Playtex, according to federal filings, had 63.46 million shares outstanding as of April 30.

Energizer is also assuming an undisclosed amount of debt, which it said would boost total purchase price to $1.9 billion.

Klein said that the deal may eventually lead to further acquisitions.

“We see Playtex as an exceptionally great fit with Energizer, with similar customers and distribution channels in the U.S. and Canada, and the opportunity for geographic expansion in many other areas of the world where we currently do business,” he said.

Playtex currently has sales in only about a dozen countries. Energizer products are sold in about 150 countries.

Playtex sales for its most recently reported 12 months through March 2007 totaled $641 million.

Neil DeFeo, chairman and chief executive officer of Playtex, said in a printed statement that Energizer offered a good premium over the company’s share price.

“For our employees, it means becoming a part of a much larger consumer products business with the scale and resources to thrive in an increasingly competitive environment,” said DeFeo, whom Klein said will retire when the transaction is complete.

The deal is expected to close by the end of the year.

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