Prestige Brands (PBH) to Acquire DenTek Oral Care in $225M Cash Deal

Prestige Brands (NYSE: PBH) has entered into a definitive agreement to acquire DenTek Oral Care, Inc. (“DenTek”), a privately-held marketer and distributor of oral care products for $225 million in cash. This transaction would add pro forma revenues and adjusted EBITDA of approximately $60 million and $23 million, respectively on an annualized basis.

The acquisition of DenTek® will expand Prestige’s portfolio of iconic OTC brands into the fast-growing specialty oral care products category in the U.S., Australia and Europe. The DenTek brand includes the #1 dental floss pick, as well as other oral care products for adults and children.

The Company plans to finance the acquisition with a combination of funds from its existing credit facilities and available cash, and expects the transaction would add approximately a half point to its leverage calculation at the time of the close. The transaction is expected to close during the first half of calendar year 2016, subject to customary closing conditions, including clearance under the Hart-Scott Rodino Antitrust Improvements Act of 1976.

Commentary

“The acquisition of DenTek, when combined with our existing oral care products, will create our fifth $100 million platform and provide the opportunity to enter the fast-growing specialty oral care category anchored by the DenTek brand,” said Ron Lombardi, President and CEO. “DenTek is an excellent fit with our acquisition criteria, which is focused on using M&A to build our portfolio and create brand-building and innovation opportunities for long-term growth. The DenTek brand complements our existing oral care platform and fits our business model with outsourced manufacturing and distribution, allowing us to focus on our core competencies in marketing and sales,” he said.

Mr. Lombardi continued, “The acquisition of DenTek will mark our seventh transaction in the past six years as we continue to execute our proven strategy of acquiring, integrating and building brands to grow our portfolio and increase shareholder value. This acquisition will bring our portfolio closer to our stated objective of 85% ‘invest for growth’ brands and 15% ‘manage for cash.’ We look forward to adding the DenTek brand to our growing portfolio and anticipate closing on this transaction during the first half of calendar year 2016, subject to regulatory approvals.”

Conference Call and Presentation

The Company will host a conference call today at 10:30 a.m. ET to review the pending acquisition. The call may be accessed by dialing 877-784-9650 about 10 minutes before the start of the call. International callers may dial 530-379-4717. A replay will be available for two weeks following the completion of the call and can be accessed by dialing 855-859-2056 or 404-537-3406 for international. A slide presentation will accompany the call and can be accessed from the Investors section of the Company’s website, www.prestigebrands.com.

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