Sunbeam 2005 Annual Report Download - page 53

Jarden Corporation
Notes to Consolidated Financial Statements (cont’d)
December 31, 2005
Holmes®, Patton®, Rival®, Seal-a-Meal®and White Mountain™. The aggregate purchase price was
approximately $680 million, including transaction expenses. The cash portion of the THG Acquisition
purchase price was financed via the issuance of an additional $380 million of term debt under the Senior
Credit Facility discussed below (also see Note 5), cash on hand and revolver borrowings.
On January 24, 2005, the Company completed the acquisition of American Household, Inc. (“AHI”
and the “AHI Acquisition”), a privately held company, for approximately $745.6 million for 100% of its
equity and the repayment of approximately $100 million of indebtedness. AHI is the parent of The
Coleman Company, Inc. (“Coleman”) and Sunbeam Products, Inc. (now known as “Jarden Consumer
Solutions” or “JCS”), leading producers of global consumer products through brands such as BRK®,
Campingaz®, Coleman®, First Alert®, Health o meter®, Mr. Coffee®, Oster®and Sunbeam®. Of the equity
portion of the purchase price, $40 million was held back by the Company to cover potential indemnification
claims against the sellers of AHI and has not been accrued as a liability or considered part of the purchase
price since the outcome of this contingency remains uncertain.
The Company financed the AHI Acquisition via the issuance of $350 million of equity securities (see
Note 9) and a new $1.05 billion senior credit facility (“Senior Credit Facility”), consisting of a term loan
facility (“Term Loan”) in the aggregate principal amount of $850 million and a revolving credit facility with
an aggregate commitment of $200 million (see Note 5). This facility replaced the Company’s Second
Amended Credit Agreement (“Second Amended Credit Agreement”).
The AHI Acquisition and THG Acquisition, along with the 2004 and 2003 acquisitions described
below, represent significant elements in advancing the Company’s strategy of acquiring branded consumer
products businesses with leading market positions in markets for products used in and around the home
and home away from home.
During 2005, the Company completed three tuck-in acquisitions within the branded consumables
division.
2004 Activity
On June 28, 2004, the Company acquired approximately 75.4% of the issued and outstanding stock of
Bicycle Holding, Inc., including its wholly owned subsidiary United States Playing Card Company
(collectively “USPC” and “USPC Acquisition”), and subsequently acquired the remaining 24.6% pursuant
to a put/call agreement (“Put/Call Agreement”) on October 4, 2004. USPC is a manufacturer and distributor
of playing cards and related games and accessories. USPC’s portfolio of owned brands includes Aviator®,
Bee®, Bicycle®and Hoyle®. In addition, USPC has an extensive list of licensed brands, including Disney®,
Harley-Davison®, Mattel®, NASCAR®and World Poker Tour™. USPC’s international holdings include
Naipes Heraclio Fournier, S.A., a leading playing card manufacturer in Europe. The aggregate purchase
price was approximately $238 million, including transaction expenses and deferred consideration amounts.
The cash portion of the purchase price funded on June 28, 2004 was financed using a combination of cash
on hand, debt financing (see Note 5) and borrowings under the Company’s then existing revolving credit
facility. The cash portion of the October 4, 2004 exercise of the Put/Call Agreement was funded by a
combination of cash on hand and revolving borrowings under the Company’s then existing senior credit
facility (see Note 5).
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