Sunbeam 2009 Annual Report Download - page 22

Management’s Discussion and Analysis
Jarden Corporation Annual Report 2009
Summary of Significant 2009 Activities
• In April 2009, the Company completed an equity offering of 12 million newly-issued shares of common stock at $17.50 per
share resulting in net proceeds of approximately $203 million.
• In April 2009, the Company completed a registered public offering for $300 million aggregate principal amount of 8% senior
unsecured notes due May 2016.
• In August 2009, the Company completed an extension of the revolving credit portion of the Company’s senior credit facility,
which was allowed for under an April 2009 amendment that extended the maturity date of the revolving facility in an aggre-
gate amount of $100 million to January 2012.
• In August 2009, the Company entered into an amendment to the Company’s senior credit facility. The amendment extended
the maturity date of $600 million principal amount of existing term loans from January 2012 to January 2015.
• The Company managed working capital to improve operating cash flows, with a particular focus on bringing inventory levels
into line with lower sales.
• As a result of the macroeconomic conditions, the Company initiated cost containment efforts, with particular focus on discre-
tionary spending. These initiatives have resulted in an overall reduction in selling, general and administrative expenses (“SG&A”).
• In September 2009, the Company announced that the Board had decided to initiate a quarterly cash dividend of $0.075 per
share of the Company’s common stock starting in the fourth quarter of 2009.
Acquisitions and Pending Acquisition
The Company has not completed a significant acquisition in over two years. To the extent the Company pursues future acquisitions,
the Company intends to focus on businesses with product offerings that provide geographic or product diversification, or expansion
into related categories that can be marketed through the Company’s existing distribution channels or provide us with new distribution
channels for our existing products, thereby increasing marketing and distribution efficiencies. Furthermore, the Company expects that
acquisition candidates would demonstrate a combination of attractive margins, strong cash flow characteristics, category leading positions
and products that generate recurring revenue. The Company anticipates that the fragmented nature of the consumer products market
will continue to provide opportunities for growth through strategic acquisitions of complementary businesses. However, there can be
no assurance that the Company will complete an acquisition(s) in any given year or that any such acquisition(s) will be significant or
successful. The Company only pursues a candidate when it is deemed to be fiscally prudent and that meets the Company’s acquisition
criteria. The Company anticipates that any future acquisitions would be financed through any combination of cash on hand, operating
cash flow, availability under our existing credit facilities and new capital market offerings.
Pending Acquisition
On December 16, 2009, we entered into a letter agreement (the “Offer Letter”) with Total S.A. (“Total”), pursuant to which we made
an irrevocable and binding offer to enter into a Share Purchase Agreement (the “SPA”) with Total for the purchase of Total’s Mapa Spontex
Baby Care and Home Care businesses (“Mapa Spontex”), through the acquisition of certain of Total’s subsidiaries (the “Acquired Companies”)
for a Euro purchase price of €335 million (approximately $500 million) in cash, less any indebtedness assumed, subject to certain adjust-
ments (the “Acquisition”). Mapa Spontex is a global manufacturer and distributor of primarily baby care and home care products with
leading market positions in Europe, Brazil and Argentina in the core categories it serves. Its baby care portfolio includes teats, soothers,
feeding bottles and other infant accessories sold primarily under the NUK®, Tigex®, Lillo®, Fiona®and First Essentials®brands. Its home
care portfolio includes sponges, rubber gloves and related cleaning products for retail, professional and industrial uses sold primarily
under the Mapa®and Spontex®brands; and health care products, including condoms sold under the Billy Boy brand. Our obligation to
enter into the SPA is subject to Total’s acceptance of our offer. Under French law, Total is not permitted to accept our offer or to enter into
the binding SPA to sell the Acquired Companies until mandatory information and consultation procedures have been completed with
certain workers’ representative bodies. The Acquisition is expected to expand the Company’s product offerings and distribution channels
into new, attractive categories and further diversify our revenue streams and increase the Company’s international presence. The
Acquisition is consistent with the Company’s strategy of purchasing leading, niche consumer-oriented brands with attractive cash flows
and strong management. The Mapa Spontex business is expected to be included in the Company’s Branded Consumables segment
from the acquisition date. The transaction is expected to close early in the second quarter of 2010, subject to receipt of regulatory
approvals, completion of required employee consultation procedures and other customary closing conditions. No assurances can be
given that the Acquisition will be consummated or, if such Acquisition is consummated, as to the final terms of such Acquisition.
20