Item 1.01. Entry into a Material Definitive Agreement.
Acquisition Agreement
On January 15, 2018, Spectrum Brands Holdings, Inc., a Delaware corporation (the “
Company
”), entered into a definitive Acquisition Agreement (the “
Acquisition Agreement
”) with Energizer Holdings, Inc., a Missouri corporation (“
Energizer
”). On the terms and subject to the conditions set forth in the Acquisition Agreement, Energizer will acquire from the Company (the “
Acquisition
”), its global battery, lighting and portable power business (the “
Business
”) for an aggregate purchase price of $2.0 billion in cash (the “
Purchase Price
”), subject to customary purchase price adjustments.
The Acquisition Agreement provides that,
upon the terms and subject to the conditions set forth in the Acquisition Agreement, Energizer will purchase the equity of certain subsidiaries of the Company involved in, and assets of Spectrum and its subsidiaries used or held for use primarily in, or that arise primarily out of, the Business and will assume certain liabilities arising primarily out of or relating primarily to the Business.
In the Acquisition Agreement, the Company and Energizer have made customary representations and warranties and have agreed to customary covenants relating to the Acquisition. Among other things, prior to the consummation of the Acquisition, the Company will be subject to certain business conduct restrictions with respect to its operation of the Business.
The Company and Energizer have agreed to indemnify each other for losses arising from certain breaches of the Acquisition Agreement and for certain other matters. In particular, the Company has agreed to indemnify Energizer for certain liabilities relating to the assets retained by the Company, and Energizer has agreed to indemnify the Company for certain liabilities assumed by Energizer, in each case as described in the Acquisition Agreement.
The Company and Energizer have agreed to enter into related agreements ancillary to the Acquisition that will become effective upon the consummation of the Acquisition, including a customary transition services agreement and reverse transition services agreement.
The consummation of the Acquisition is subject to certain customary conditions, including, among other things, (i) the absence of a material adverse effect on the Business, (ii) the expiration or termination of required waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, (iii) the receipt of certain other antitrust approvals in certain specified foreign jurisdictions (the conditions contained in (ii) and (iii) together, the “
Antitrust Conditions
”), (iv) the accuracy of the representations and warranties of the parties (generally subject to a customary material adverse effect standard (as described in the Acquisition Agreement) or other customary materiality qualifications), (v) the absence of governmental restrictions on the consummation of the Acquisition in certain jurisdictions, and (vi) material compliance by the parties with their respective covenants and agreements under the Acquisition Agreement. The consummation of the Acquisition is not subject to any financing condition. The Acquisition is expected to be consummated prior to the end of calendar 2018. Energizer has obtained
financing commitments with respect to the Acquisition from
Barclays Bank PLC and JPMorgan Chase Bank, N.A.
The Acquisition Agreement also contains certain termination rights, including the right of either party to terminate the Acquisition Agreement if the consummation of the Acquisition has not occurred on or before July 15, 2019 (the “
Termination Date
”). Further, if the Acquisition has not been consummated by the Termination Date and all conditions precedent to Energizer’s obligation to consummate the Acquisition have otherwise been satisfied except for one or more of the Antitrust Conditions, then Energizer would be required to pay the Company a termination fee of $100 million.
The foregoing description of the
Acquisition Agreement
and the transactions contemplated thereby is not complete and is subject to, and qualified in its entirety by reference to, the
Acquisition Agreement
, a copy of which is filed with this Current Report on Form
8-K as Exhibit 2.1 and the terms of which are incorporated herein by reference
. The Acquisition Agreement has been attached to provide investors with information regarding its terms. It is not intended to provide any other factual information about the Company, Energizer or the Business. In particular, the assertions embodied in the representations and warranties in the Acquisition Agreement were made as of a specified date, are modified or qualified by information in a confidential disclosure letter prepared in connection with the execution and delivery of the Acquisition Agreement, may be subject to a contractual standard of materiality different from what might be viewed as material to shareholders, or may have been used for the purpose of allocating risk between the parties. Accordingly, the representations and warranties in the Acquisition Agreement are not necessarily characterizations of the actual state of facts about the Company, Energizer, or the Business at the time they were made or otherwise and should only be read in conjunction with the other information that the Company makes publicly available in reports, statements and other documents filed with the U.S. Securities and Exchange Commission (the “
SEC
”).