Energizer completes buy of Armor All
With a $1.5 billion deal nearly complete to acquire the Rayovac battery business from Spectrum Brands, Energizer Holdings has completed the $1.25 billion buy of a Spectrum division that sells Armor All, STP and other auto-care products — with its main office in Danbury across town from archrival Duracell on the Bethel border.
Energizer is based in St. Louis, having been spun off in July 2015 from Edgewell Personal Care, which has a Shelton office and a Milford plant that makes Schick razors. Spectrum’s Global Auto Care division has its headquarters in the Ridgebury Corporate Center at 44 Old Ridgebury Road, with other building tenants including General Motors and Crown World Mobility.
Speaking to investment analysts in mid-November, Energizer’s chief operating officer said that the company believes it can improve the performance of Spectrum’s Global Auto Care group. This month, Spectrum CEO David Maura discussed operational issues with the division the company acquired in 2015 from the private equity investment firm Avista Capital Partners, adding Energizer takes over a unit “in a healthy state” after the write off or liquidation of excess inventory.
Spectrum Global Auto Care took a $28.7 million operating loss in 2017 on the heels of profits of $101 million and $118 million the prior two years, with revenue up 4 percent last year to $466 million.
“We’ve had a lot of open and honest dialog with Spectrum and they’ve been a tremendous deal partner, really laying a lot of the cards on the table and letting us know what the operational issues were,” said Mark Lavigne, chief operating officer of Energizer, speaking in mid-November. “There is still work to be done — we are going to attack it the same way they have in recent months.”
Energizer sales were up 2 percent last year to nearly $1.8 billion, with earnings down by more than half to $93.5 million. While Energizer sales are dominated by batteries, the company has several lines of auto products including Nu Finish and Eagle One polishes and Refresh Your Car odor eliminators.
Energizer expects to complete early next year its purchase of Spectrum’s battery business, which includes Rayovac and other brands, with market leader Duracell having its main research and development lab in Bethel and corporate offices in Chicago under holding company Berkshire Hathaway.
Alex.Soule@scni.com; 203-842-2545; @casoulman