Rayovac 2005 Annual Report Download - page 115

The Company has refl ected the carrying value of
its Mexico City, Mexico manufacturing plant and the
Company’s Madison, Wisconsin packaging facility as
assets held for sale. In November 2004, the Com-
pany completed the sale of its Mexico City, Mexico
manufacturing plant. The value of these facilities at
September 30, 2004 is approximately $9,900 and
is included in Prepaid expenses and other in the
Consolidated Balance Sheets.
All activities associated with the 2003 restructur-
ing initiatives have been completed, and the remain-
ing cash payments and the disposition of impaired
assets are complete at September 30, 2005.
(16) Acquisitions
Acquisition of Jungle Labs
On September 1, 2005, the Company acquired
Jungle Labs for approximately $29,000, which
includes $26,000 cash consideration, $1,000
escrowed purchase price, acquisition related expen-
ditures of $200 and $2,000 of non-compete
arrangements to be earned and paid over the next
12 months. Cash acquired totaled approximately
$600. The purchase agreement also contains a
provision for contingent earnout payments not to
exceed $3,500. The total earnout calculation is
based upon net sales of Jungle products through
August 31, 2007. Such amounts to be paid, if any,
will be recorded as additional acquisition consider-
ation. Based in San Antonio, Texas, Jungle Labs is
a leading manufacturer and marketer of premium
water and fi sh care products, including water condi-
tioners, plant and fi sh foods, fi sh medications and
other products designed to maintain an optimal envi-
ronment in aquariums or ponds. Jungle is known for
such innovative high-end products as Tank Buddies
fi zz tablets for easy fi sh and water care, and
Quick Dip test strips for fast accurate water testing.
Jungle Labs generates annual revenues of approxi-
mately $14,000. Subsequent to the acquisition,
the fi nancial results of Jungle are included in the
United business segment within the Company’s
consolidated results.
The Company is currently fi nalizing the valuation
of intangible assets and property, plant and equip-
ment acquired which may impact the estimates of the
fair value of net assets acquired in the transaction.
As of September 1, 2005
Current assets $ 3,000
Property, plant, and equipment 1,000
Intangible assets 10,000
Goodwill 19,000
Total assets acquired 33,000
Current liabilities 3,000
Short-term debt –
Long-term liabilities 3,000
Total liabilities assumed 6,000
Net assets acquired $27,000
Less: Cash acquired (600)
Payments for acquisitions $26,400
None of the goodwill acquired in this transaction
is expected to be deductible for tax purposes.
Acquisition of Tetra
On April 29, 2005, the Company acquired all of
the outstanding equity interests of Tetra Holding
GmbH (“Tetra”) for a purchase price of approximately
$550,000, net of cash acquired of approximately
$13,000 and inclusive of a fi nal working capital pay-
ment of $2,400, made in July 2005. The aggregate
purchase price also included acquisition related
expenditures of approximately $16,100. The acqui-
sition was fi nanced with additional borrowings
under an Incremental Term Loan Facility and existing
Revolving Credit Facility. Headquartered in Melle,
Germany, Tetra manufactures, distributes and mar-
kets a comprehensive line of foods, equipment and
care products for fi sh and reptiles, along with acces-
sories for home aquariums and ponds. This acquisi-
tion provides the Company with a global brand and
distribution to extend its North American pet sup-
plies business. At the time of the acquisition, Tetra
had approximately 700 employees. Tetra operates
in over 90 countries and holds leading market
positions in Europe, North America and Japan.
Subsequent to the acquisition, the fi nancial results
of Tetra are reported as a separate business seg-
ment within the Company’s consolidated results.
Tetra contributed $95,869 in net sales and recorded
operating income of $9,652 in the current year.
2005 Form 10-K Annual Report
Spectrum Brands, Inc.
2005 ANNUAL REPORT 95