Clorox agrees to acquire Nutranext
Clorox (CLX) announced that it has entered into a definitive agreement to acquire Nutranext, a health and wellness company based in Sunrise, Florida, which manufactures and markets leading dietary supplement brands in the retail and e-commerce channels as well as in its direct-to-consumer business.
The Nutranext acquisition brings significant scale and breadth to Clorox’s dietary supplements business.
It follows the company’s May 2016 acquisition of the RenewLife brand, a leader in digestive health. Clorox’s brand-building capabilities and retail execution behind the RenewLife brand have led to strong growth in the e-commerce channel and expanded distribution in the retail channel. In calendar year 2017, Nutranext generated sales of about $200M.
Clorox will pay $700M to acquire Nutranext, with the purchase price representing about 3.5 times calendar year 2017 sales.
The company expects to fund the transaction through a combination of available cash and debt financing, while maintaining a Debt/EBITDA ratio within its target range of 2.0x to 2.5x.
The transaction is subject to certain closing conditions, including customary regulatory approvals, and is expected to close in the company’s fiscal fourth quarter, which ends June 30, 2018.
Clorox’s preliminary estimates indicate the acquisition will dilute earnings per share by 7-11c in the fourth quarter of its current fiscal year, ending June 30, 2018, and by 8c-12c in fiscal year 2019 and be accretive to earnings per share in fiscal year 2020.
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