PARK CITY, Utah, May 22, 2017 /PRNewswire/ -- Nutraceutical
International Corporation (NASDAQ: NUTR) ("Nutraceutical" or the
"Company") and HGGC, LLC ("HGGC"), a leading middle-market private
equity firm, today announced that they have entered into a
definitive agreement under which Nutraceutical will be acquired by
an affiliate of HGGC in a transaction valued at approximately
$446 million, including debt to be
refinanced. Under the terms of the agreement, Nutraceutical
stockholders will receive $41.80 in
cash (without interest) for each outstanding share of Nutraceutical
common stock they own, which represents a 49% premium to the
Company's closing stock price on May 19,
2017, the last full trading day before today's announcement,
and a 15.6% premium to the Company's all-time high closing stock
price.
"We are pleased to announce this transaction, which delivers
significant value to our stockholders, many of whom have been with
us since our initial IPO in 1998," said Bill Gay, Chairman and Chief Executive Officer
of Nutraceutical. "We are excited to be joining forces with HGGC,
which is a world-class private equity firm. HGGC's expertise
in formulating strategic growth plans for middle-market companies
will be a great platform for the future of Nutraceutical. We
expect that the combination of HGGC's strategic insights and the
deep industry experience and knowledge of our management team will
help us continue to build and grow. We remain committed to
our employees and their families, to our customers, to our
world-wide consumers and to the natural products industry.
Our management team is looking forward to working with HGGC to
pursue the next chapter of our successful story. We
especially want to thank our employees for their years of
dedication and hard work. We truly believe that HGGC will be
a great partner as we go forward as a private company."
Rich Lawson, Co-founder and Chief
Executive Officer of HGGC, said "We congratulate the management
team and employees of Nutraceutical for building an
industry-leading nutritional supplement business, and we look
forward to working with the Nutraceutical team to continue to
pursue growth opportunities globally."
"Nutraceutical is an impressive company with a diverse portfolio
of brands and thousands of satisfied retail customers, as well as
millions of loyal consumers who rely on its products," commented
Les Brown, Managing Director and
Chief Operating Officer of HGGC. "Nutraceutical is a great example
of a successful roll-up strategy carried out with consistency and
dedication over the last 25 years. We have long admired their
disciplined market approach, which has allowed the Company to
consistently generate strong financial returns and positive cash
flow."
The agreement has been unanimously approved by Nutraceutical's
board of directors, acting on the recommendation of a special
committee of independent and disinterested directors. The
special committee negotiated the terms of the agreement with the
assistance of its financial and legal advisors.
The Company will undertake a 60-day "go-shop" period, commencing
immediately, during which the special committee, with the
assistance of its financial and legal advisors, will actively
solicit, evaluate and potentially enter into negotiations with
parties who offer alternative proposals. There can be no assurance
that this process will result in a superior offer or that any other
transaction will be approved or completed. The Company does
not expect to disclose developments with respect to the
solicitation process unless and until the special committee has
made a decision with respect to any potential superior
proposal.
The transaction, which is expected to close in the second half
of 2017, is subject to customary closing conditions, including
Company stockholder approval and the expiration or termination of
the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976. There are no financing conditions
associated with the transaction. Bill
Gay and Jeff Hinrichs, Chief
Operating Officer and Executive Vice President of the Company, who
own approximately 7.9% and 2.5% of the Company's outstanding common
stock, respectively, have entered into customary voting agreements
pursuant to which they have agreed to vote all of their shares in
favor of the transaction.
Peter J. Solomon Company is acting as financial and strategic
advisor to the Company and Paul, Weiss, Rifkind, Wharton &
Garrison LLP is acting as its counsel. Piper Jaffray & Co. is acting as financial
advisor to HGGC and Kirkland & Ellis LLP is acting as its
counsel.
ABOUT NUTRACEUTICAL
Nutraceutical is an integrated manufacturer, marketer,
distributor and retailer of branded nutritional supplements and
other natural products sold primarily to and through domestic
health and natural food stores. Internationally,
Nutraceutical markets and distributes branded nutritional
supplements and other natural products to and through health and
natural product distributors and retailers. Nutraceutical's
core business strategy is to acquire, integrate and operate
businesses in the natural products industry that manufacture,
market and distribute branded nutritional supplements.
Nutraceutical believes that the consolidation and integration of
these acquired businesses provides ongoing financial synergies
through increased scale and market penetration, as well as
strengthened customer relationships.
Nutraceutical manufactures and sells nutritional supplements and
other natural products under numerous brands, including
Solaray®, KAL®, Dynamic Health®, Nature's
Life®, LifeTime®, Natural Balance®,
NaturalCare®, Health from the Sun®, Zhou
Nutrition®, Pioneer®, Nutra BioGenesis®,
Life-flo®, Organix South®, Heritage Store® and
Monarch Nutraceuticals®.
Nutraceutical owns neighborhood natural food markets, which
operate under the trade names The Real Food Company™,
Thom's Natural Foods™, Cornucopia Community Market™
and Granola's®. Nutraceutical also owns health food
stores, which operate under the trade name Fresh
Vitamins®.
Nutraceutical manufactures and/or distributes one of the
broadest branded product lines in the industry, with approximately
7,500 SKUs, including approximately 750 SKUs exclusively sold
internationally. Nutraceutical believes that, as a result of
its emphasis on innovation, quality, loyalty, education and
customer service, its brands are widely recognized in health and
natural food stores and among their customers.
ABOUT HGGC
HGGC is a leading middle-market private equity firm with over
$4.25 billion in cumulative capital
commitments. Based in Palo Alto,
California, HGGC is distinguished by its Advantaged
Investing strategy that is designed to enable the firm to source
and acquire scalable businesses at attractive multiples through
partnerships with management teams, founders and sponsors who
reinvest alongside HGGC, creating a strong alignment of
interests. Over its history, HGGC has completed more than 60
platform investments, add-on acquisitions, recapitalizations and
liquidity events with an aggregate transaction value of more than
$12 billion. More information,
including a complete list of current and former portfolio
companies, is available at www.hggc.com.
Additional Information and Where to Find It
The Company will furnish to the Securities and Exchange
Commission a report on Form 8-K regarding the proposed transactions
described in this press release, which will include the merger
agreement. All parties desiring details regarding the merger are
urged to review these documents, which will be available at the
Securities and Exchange Commission's web site at www.sec.gov.
In connection with the merger, the Company plans to file with
the Securities and Exchange Commission and furnish its stockholders
a proxy statement. Additionally, the Company will file other
relevant materials with the Securities and Exchange Commission in
connection with the proposed transaction. The materials to be filed
by the Company with the Securities and Exchange Commission may be
obtained free of charge at the Securities and Exchange Commission's
web site at www.sec.gov. In addition, stockholders also may
obtain free copies of the proxy statement from the Company by
contacting Nutraceutical Investor Relations at 1400 Kearns Blvd.,
2nd Floor, Park City,
UT 84060, telephone number (435) 655-6106 or
investor@nutraceutical.com. Investors and STOCKHOLDERS of the
Company are urged to read the proxy statement and the other
relevant materials when they become available before making any
voting or investment decision with respect to the proposed merger
because they will contain important information about the merger
and the parties to the merger.
This press release is neither a solicitation of proxy, an offer
to purchase nor a solicitation of an offer to sell any securities
and it is not a substitute for any proxy statement or other filings
that may be made with the Securities and Exchange Commission should
the merger proceed.
Participants in the Solicitation
The Company and its directors, executive officers and other
members of their management and employees, under the Securities and
Exchange Commission rules, may be deemed to be participants in the
solicitation of proxies of the Company's stockholders in connection
with the proposed merger. Investors and security holders may obtain
more detailed information regarding the names, affiliations and
interests of certain of the Company's executive officers and
directors in the solicitation by reading the Company's proxy
statement for its 2017 annual meeting of stockholders and the proxy
statement and other relevant materials which may be filed with the
Securities and Exchange Commission in connection with the merger
when and if they become available. Information concerning the
interests of the Company's participants in the solicitation, which
may, in some cases, be different than those of the Company's
stockholders generally, will be set forth in the proxy statement
relating to the merger when and if it becomes available. Additional
information regarding the Company's executive officers and
directors in the solicitation is available by reading the Company's
proxy statement for its 2017 annual meeting of stockholders.
Forward Looking Statements
Any statements in this press release about future events or
future results, the expected timing of the completion of the
proposed merger and the ability to complete the proposed merger,
and other statements containing the words "estimates," "believes,"
"anticipates," "plans," "expects," "will," and similar expressions,
other than historical facts, constitute forward-looking statements
within the meaning of the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. The actual results of the
merger could vary materially as a result of a number of factors,
including, but not limited to: (i) the possibility that competing
offers will be made; (ii) the occurrence of any event, change or
other circumstances that could give rise to the termination of the
merger agreement; and (iii) the inability to complete the proposed
merger due to the failure to obtain stockholder approval for the
proposed merger or the failure to satisfy other conditions to
completion of the proposed merger. Other factors that may cause
actual results to differ materially include those set forth in the
reports that Nutraceutical files from time to time with the
Securities and Exchange Commission, including its annual report on
Form 10-K for the year ended September 30,
2016 and quarterly and current reports on Form 10-Q and 8-K.
These forward-looking statements reflect Nutraceutical's
expectations as of the date of this press release. Nutraceutical
undertakes no obligation to update the information provided
herein. These forward-looking statements should not be relied
upon as representing our views as of any date subsequent to the
date hereof.
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SOURCE Nutraceutical International Corporation