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Jarden Announces Agreement To Acquire Yankee Candle For $1.75 Billion



    Jarden Announces Agreement To Acquire Yankee Candle For $1.75 Billion

- Transaction will be accretive to adjusted earnings per share, pre-synergies

- Cross-selling and cross-channel opportunities expected to drive top-line
growth

- Acquisition will enhance overall gross profit and EBITDA margins

- Jarden to hold webcast/conference call at 8:30 a.m. EDT today; details at
end of release

PR Newswire

RYE, N.Y., Sept. 3, 2013

RYE, N.Y., Sept. 3, 2013 /PRNewswire/ -- Jarden Corporation ("Jarden" or the
"Company") (NYSE: JAH), a leading global consumer products company, announced
today that it has entered into a definitive purchase agreement to acquire
Yankee Candle Investments LLC ("Yankee Candle"), a leading specialty-branded
premium scented candle company in the United States, from a fund managed by
Madison Dearborn Partners, LLC, a private equity firm, for approximately $1.75
billion in cash, subject to working capital and other adjustments.

The transaction will extend Jarden's portfolio of market-leading, consumer
brands in niche, seasonal staple categories, while creating opportunities in
cross-selling, broadening the global distribution platform, and deepening
Jarden's talent bench. Upon closing the transaction, Jarden would have pro
forma net sales and adjusted EBITDA of approximately $7.7 billion and $1.0
billion, respectively, for the twelve months ended June 30, 2013. As an
addition to Jarden's Branded Consumables segment, Yankee Candle will further
balance Jarden's portfolio, expanding this segment to approximately 35% of
combined sales. The transaction is expected to be funded with cash on hand,
common equity and the balance through a mix of bank debt and bonds.

Yankee Candle has many of the same attractive business characteristics as
Jarden, including a leading market position in its core categories, a loyal
customer base and an experienced management team. Yankee Candle has delivered
consistent organic growth that is in line with Jarden's overall top-line
growth profile of 3%-5%, as well as strong margins and solid cash flow. Its
seasonal staple characteristics have enabled Yankee Candle to demonstrate a
proven resilience through economic cycles.

The transaction is perfectly aligned with Jarden's disciplined acquisition
criteria, and it will enhance the Company's overall margin profile. Pro forma
for the transaction, Jarden's adjusted gross profit and adjusted EBITDA
margins for the twelve months ended June 30, 2013 would have been 32.1% and
13.2%, respectively, compared to 28.9% and 11.8%, respectively, on a
standalone basis. The transaction is expected to be accretive to Jarden's
adjusted earnings per share by approximately 10%, pre synergies. Additionally,
Yankee Candle's strong cash flow generative characteristics are consistent
with the balance of Jarden's portfolio. We anticipate that the combination
will achieve our target leverage ratio within the first year of ownership.

Martin E. Franklin, Jarden's Founder and Executive Chairman, commented, "We
are delighted to announce this acquisition, which is consistent with our more
than ten-year track record of success in acquiring leading consumer brands
synonymous with their niche categories. The iconic Yankee Candle brand is a
natural extension of our existing portfolio and of our Branded Consumables
business segment. As a successful, well-managed and well-invested business,
Yankee Candle is a solid platform for us to leverage our proven, time-tested
and portable brand-building approach and to drive additional value through
investments in brand equity, product development and innovation. As our first
significant acquisition since April 2010, Yankee Candle embodies all of the
characteristics of our market-leading brands, while offering a compelling
financial and strategic value proposition."

James E. Lillie, Jarden's Chief Executive Officer, added, "Not only will this
acquisition immediately enhance our financial performance and create exciting
new revenue drivers, but also it will expand the deep bench of talent that we
have developed over the years. Our complementary strengths and skillsets pave
the way for new cross-selling opportunities, cross-brand collaboration,
partnerships and cross-business support, accelerating revenue growth across
our global platform and driving long-term shareholder value. Jarden's global
presence, capabilities and scale will facilitate Yankee Candle's expansion
into new markets and geographies to further drive top-line growth and
profitability. At the same time, Yankee Candle's gross profit and EBITDA
margins will enhance Jarden's overall margins. Potential future cost and
distribution synergies will help support investments and drive bottom-line
improvements across the Jarden platform."

Harlan M. Kent, Yankee Candle's President and Chief Executive Officer, added,
"This is a transformative milestone for Yankee Candle. Over the past 40 years,
we have built a truly iconic brand with a deeply loyal customer base. Jarden
is well known as a stable, long-term owner of businesses, and this will
provide us with a perfect platform on which to grow. This acquisition provides
us with the resources and scale necessary to drive our future success and will
further strengthen our existing product development and distribution
capabilities. Jarden's similar niche consumer strategy and complementary
consumer portfolio will help to accelerate our expansion. I'd like to thank
all of Yankee Candle's employees for their ongoing dedication to the business
and hope they share in my excitement as we look forward to the next stage of
our growth as part of the Jarden family."

The transaction, which is expected to close early in the fourth quarter of
2013, is subject to customary closing conditions and regulatory approvals.

Please see the schedule accompanying this release for a reconciliation of
non-GAAP adjusted gross profit, adjusted gross profit margin, adjusted EBITDA,
and adjusted EBITDA margin to the comparable GAAP measures.

Conference Call Information

Jarden will be hosting a conference call at 8:30 a.m. Eastern Time on
September 3, 2013 to discuss the transaction. The listen-only mode of the call
can be accessed by dialing 1-888-708-5692 (or 1-913-312-1443 for international
callers) and entering the following pass code: 1817117. The call will also be
webcast simultaneously through the Company's website, www.jarden.com, and will
be archived approximately one hour after completion of the call. Additionally,
a telephonic re-play of the call will be available at 11:30 a.m. Eastern Time
on September 3, 2013 until 11:59 p.m. Eastern Time on September 10, 2013 and
can be accessed by dialing 1-877-870-5176.

A slide presentation will be available at  www.jarden.com.

Safe Harbor

This news release contains "forward-looking statements" within the meaning of
the federal securities laws and is intended to qualify for the safe harbor
from liability established by the Private Securities Litigation Reform Act of
1995, including statements regarding the impact of the Yankee Candle
acquisition on the Company's business and financial results including sales,
segment net sales, adjusted EBITDA, adjusted gross profit, accretive to
earnings, adjusted EPS, overall margin profiles, adjusted gross margin,
adjusted EBITDA margin and cash flows, the ability of the Company  to close
the Yankee Candle acquisition, the ability of the Company to raise the funds
needed to close the Yankee Candle acquisition and the expected plan to fund
the Yankee Candle acquisition, the Company's earnings per share and adjusted
diluted earnings per share, expected or estimated revenue, segment earnings,
net interest expense, income tax provision, cash flow from operations, and
reorganization and other non-cash charges, the outlook for the Company's
markets and the demand for its products, consistent profitable growth, free
cash flow, future revenues and gross, operating and EBITDA margin improvement
requirement and expansion, organic net sales growth, bank leverage ratio, the
success of new product introductions, growth in costs and expenses, the impact
of commodities, currencies and transportation costs and the Company's ability
to manage its risk in these areas, repurchase of shares of common stock from
time to time under the Company's stock repurchase program, our ability to
raise new debt, and the impact of acquisitions, divestitures, restructurings,
and other unusual items, including the Company's ability to successfully
integrate and obtain the anticipated results and synergies from its
consummated acquisitions. These projections and statements are based on
management's estimates and assumptions with respect to future events and
financial performance and are believed to be reasonable, though are inherently
uncertain and difficult to predict. Actual results could differ materially
from those projected as a result of certain factors. A discussion of factors
that could cause results to vary is included in the Company's periodic and
other reports filed with the Securities and Exchange Commission.

About Yankee Candle

Yankee Candle is a leading designer, manufacturer, wholesaler and retailer of
premium scented candles, based on sales. Yankee Candle participates in the $25
billion global candle and home fragrance market. Yankee Candle has a 43-year
history of offering distinctive products and marketing them as affordable
luxuries and consumable gifts. Yankee Candle sells its products through a
North American wholesale customer network of approximately 35,000 store
locations, a growing base of Yankee Candle owned and operated retail stores,
direct mail catalogs, and its Internet website (www.yankeecandle.com). Outside
of North America, Yankee Candle sells its products primarily through an
international wholesale customer network of over 6,000 store locations and
distributors covering over 50 countries on a combined basis.

About Jarden Corporation

Jarden Corporation is a leading provider of a diverse range of consumer
products with a portfolio of over 120 trusted, quality brands sold
globally. Jarden operates in three primary business segments through a number
of well recognized brands, including: Outdoor Solutions: Abu Garcia®, Aero®,
Berkley®, Campingaz® and Coleman®, ExOfficio®, Fenwick®, Gulp!®, Invicta®,
K2®, Marker®, Marmot®, Mitchell®, Penn®, Rawlings®, Shakespeare®, Stearns®,
Stren®, Trilene®, Volkl® and Zoot®; Consumer Solutions: Bionaire®, Breville®,
Crock-Pot®, FoodSaver®, Health o meter®, Holmes®, Mr. Coffee®, Oster®,
Patton®, Rival®, Seal-a-Meal®, Sunbeam®, VillaWare® and White Mountain®; and
Branded Consumables: Ball®, Bee®, Bernardin®, Bicycle®, Billy Boy®, Crawford®,
Diamond®, Dicon®, Fiona®, First Alert®, First Essentials®, Hoyle®, Kerr®,
Lehigh®, Lifoam®, Lillo®, Loew Cornell®, Mapa®, NUK®, Pine Mountain®,
Quickie®, Spontex® and Tigex®. Headquartered in Rye, N.Y., Jarden ranks #383
on the Fortune 500 and has over 25,000 employees worldwide. For further
information about Jarden, please visit www.jarden.com.

Note: This release contains non-GAAP financial measures that may not be
directly comparable to other similarly titled measures used by other
companies. For purposes of Regulation G, a non-GAAP financial measure is a
numerical measure of a company's historical or future financial performance,
financial position or cash flows that excludes amounts, or is subject to
adjustments that have the effect of excluding amounts, that are included in
the most directly comparable measure calculated and presented in accordance
with GAAP in the statements of operations, balance sheets, or statements of
cash flows of the Company; or includes amounts, or is subject to adjustments
that have the effect of including amounts, that are excluded from the most
directly comparable measure so calculated and presented. Pursuant to the
requirements of Regulation G, the Company has provided reconciliations of the
non-GAAP financial measures to the most directly comparable GAAP financial
measures. These non-GAAP measures are provided because management of the
Company uses these financial measures in monitoring and evaluating the
Company's ongoing financial results and trends. Management uses this non-GAAP
information as an indicator of business performance, and evaluates overall
management with respect to such indicators. Additionally, the Company uses
non-GAAP financial measures because the Company's credit agreement provides
for certain adjustments in calculations used for determining whether the
Company is in compliance with certain credit agreement covenants, including,
but not limited to, adjustments relating to non-cash purchase accounting
adjustments, non-cash impairment charges of goodwill, intangibles and other
assets, certain net reorganization costs and acquisition-related and other
charges, transaction and integration costs, Venezuela hyperinflationary and
devaluation-related charges, gains and losses as a result of currency
fluctuations, gain on the sale of a domestic business, non-cash stock-based
compensation costs, loss on early extinguishment of debt, non-cash original
issue discount amortization and other items. Adjusted gross margin is
calculated by dividing adjusted gross profit by net sales. Segment earnings
(as adjusted EBITDA) margin is calculated by dividing segment earnings (as
adjusted EBITDA) by net sales. These non-GAAP measures should be considered in
addition to, but not as a substitute for, measures of financial performance
prepared in accordance with GAAP.

Schedule to Release

Supplemental Pro Forma Financial Information (unaudited)
($ in millions)
                                  Jarden       Yankee Candle      Pro Forma
                                  12 Months    52 Weeks           12 Months
                                  Ended        Ended              Ended
                                  6/30/2013    6/29/2013          6/30/2013
Net sales                         $      6,865 $              863 $      7,728
Adjusted gross profit             $      1,985 $              494 $      2,479
% Margin                          28.9%        57.2%              32.1%
Adjusted EBITDA (Segment          $        813 $              205 $      1,018
Earnings)
% Margin                          11.8%        23.8%              13.2%

 

Supplemental Combined Financial Information (unaudited)
($ in millions)
                             Jarden       Yankee Candle       Combined
                             12 Months    52 Weeks            12 Months
                             Ended        Ended               Ended
                             6/30/2013    6/29/2013           6/30/2013
Cash flow from operations    $        436 $                82 $         518

 

Jarden Supplemental Financial Information (unaudited)
($ in millions)                    Six Months Ended
                                   6/30/2013      6/30/2012     Inc/(Dec) %
Net sales                          $    3,340     $    3,171    5.3 %
Adjusted gross profit              $       962    $       916   5.0 %
% Margin                           28.8%          28.9%
Adjusted EBITDA (Segment           $       348    $       349   (0.4%)
Earnings)
% Margin                           10.4%          11.0%
Cash flow from operations          $        (41 ) $           3             NM

 

Jarden Corporation
Reconciliation of GAAP to Non-GAAP
Jarden Latest Twelve Months ("LTM") Segment Earnings Reconciliation
(unaudited)
($ in millions)                  Year Ended Six Months Ended         LTM Ended
                                 12/31/2012 6/30/2013    6/30/2012   6/30/2013
Reconciliation of Non-GAAP
measure:
Net income                       $          $         72 $       118 $        
                                  244                                 198
Income tax provision             148        42           70          120
Interest expense, net            185        96           90          191
Loss on early extinguishment     —          26           —           26
of debt
Operating Earnings               $          $       236  $       278 $        
                                  577                                 535
Adjustments to reconcile to
Segment Earnings
Depreciation and amortization    $          $         76 $           $        
                                  153                    71           158
Fair market value adjustments    6          5            —           11
to inventory
Reorganization costs, net        27         2            —           29
Acquisition-related and other    17         —            —           17
costs, net
Venezuela devaluation-related    —          29           —           29
charges
Cumulative adjustment of stock   34         —            —           34
compensation
Segment Earnings                 $          $       348  $       349 $        
                                  814                                 813

 

Jarden LTM Gross Profit Reconciliation (unaudited)
($ in millions)                Year Ended    Six Months Ended        LTM Ended
                               12/31/2012    6/30/2013   6/30/2012   6/30/2013
Reconciliation of Non-GAAP
measure:
Net sales                      $       6,696 $    3,340  $    3,171  $      
                                                                      6,865
Cost of sales                  4,772         2,383       2,255       4,900
Gross profit                   $       1,924 $       957 $       916 $      
                                                                      1,965
Adjustments to reconcile to
Adjusted Gross Profit
Fair market value adjustments  6             5           —           11
to inventory
Accelerated depreciation
related to international       9             —           —           9
platform rationalization
Adjusted Gross Profit          $       1,939 $       962 $       916 $      
                                                                      1,985

 

Yankee Candle Segment Earnings Reconciliation (unaudited)
($ in millions)            52 Weeks Ended  26 Weeks Ended      52 Weeks Ended
                           12/29/2012      6/29/2013 6/30/2012 6/29/2013
Reconciliation of
Non-GAAP measure:
Net income (loss)          $               $         $         $              
                             33             (18 )     (28 )      43
Provision of income taxes  22              (9 )      (16 )     29
Income (loss) from
continuing operations      $               $         $         $              
before provision             55             (27 )     (44 )      72
for income taxes
Adjustments to reconcile
to Income from continuing
operations before
provision for income
taxes
Interest expense           $               $         $         $              
                           107             49        53        103
Depreciation and           35              17        18        34
amortization
Amortization included in   (7 )            (4 )      (3 )      (8 )
interest expense
Realized gain on           (8 )            (2 )      (4 )      (6 )
derivative contracts
EBITDA from Continuing     $               $         $         $              
Operations                 182             33        20        195
Loss on early              13              —         13        —
extinguishment of debt
Restructuring costs        2               1         1         2
Non-recurring advisory     1               1         1         1
fee
Realized losses on         1               —         1         —
foreign currency
Non-cash equity based      1               —         —         1
compensation
Other one-time charges     1               1         1         1
Estimated impact of
certain non-recurring      5               1         1         5
events
Segment Earnings           $               $         $         $              
                           206             37        38        205

 

Yankee Candle Gross Profit Reconciliation (unaudited)
($ in millions)            52 Weeks Ended  26 Weeks Ended      52 Weeks Ended
                           12/29/2012      6/29/2013 6/30/2012 6/29/2013
Reconciliation of
Non-GAAP measure:
Net sales                  $               $         $         $              
                           844             319       300       863
Cost of sales              364             145       135       374
Gross profit               $               $         $         $              
                           480             174       165       489
Adjustments to reconcile
to Adjusted Gross Profit
Estimated impact of
certain non-recurring      5               1         1         5
events
Adjusted Gross Profit      $               $         $         $              
                           485             175       166       494

 

Pro Forma Combined Adjusted EBITDA Reconciliation (unaudited)
                                                              LTM Ended
($ in millions)                                               6/30/2013
                                                              Pro Forma
Reconciliation of Non-GAAP measure:
Net income                                                    $            273
Provision of income taxes                                     168
Income from continuing operations before provisionfor         $            441
income taxes
Interest expense                                              $            227
Realized gain on derivative contracts                         (6 )
Loss on early extinguishment of debt                          26
EBIT                                                          $            688
Depreciation and amortization                                 $            208
Amortization included in interest expense                     (8 )
EBITDA from Continuing Operations                             $            888
Fair market value adjustments to inventory                    11
Reorganization costs, net                                     29
Acquisition-related and other costs, net                      17
Venezuela devaluation-related charges                         29
Cumulative adjustment of stock compensation                   35
Restructuring costs, net                                      2
Non-recurring advisory fee                                    1
Other one-time charges                                        1
Estimated impact of certain non-recurring events              5
Segment Earnings                                              $         1,018

 

SOURCE Jarden Corporation

Website: http://www.jarden.com
Website: http://www.yankeecandle.com
Contact: Rachel Wilson, 914-967-9400; Investors: Allison Malkin, ICR, Inc.,
203-682-8225; Press: Liz Cohen, Weber Shandwick, 212-445-8044
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