Under the terms of the transaction, Martek will pay consideration of $200m, subject to working capital adjustments, of which $120m will be paid from its current cash reserves and the remainder from a new credit facility.
Amerifit Brands develops, markets and distributes branded consumer health and wellness products focused on women’s and digestive health benefits. The company’s key products include: Culturelle, a probiotic supplement, and AZO, the OTC brand addressing symptom relief, detection and prevention of urinary tract infections, and Estroven, the all-natural nutritional supplement brand addressing the symptoms of menopause.
Steve Dubin, CEO of Martek, said: “Amerifit’s first-class sales and marketing infrastructure and proven management team for selling branded consumer health and wellness products provide Martek with a platform for accelerating the commercialization of our nutritional product pipeline. I am excited at the prospect of being able to develop consumer brands for some of the exciting new products in Martek’s pipeline. This new capability will enable Martek to move up the value chain by getting closer to the consumer and should result in increased revenue and gross profit opportunities.”
Amerifit, CEO of Cyrill Siewert, said: “The entire management team here at Amerifit is thrilled to become part of the Martek family. Amerifit’s capabilities of marketing and growing leading consumer brands along with Martek’s promising product pipeline, robust R&D capabilities, and commitment to science-based products is a compelling combination that should provide powerful opportunities for growth in the years ahead.”
The transaction is expected to be accretive to Martek’s earnings in fiscal 2010. It is expected to close in Martek’s second fiscal quarter, subject to customary closing conditions, including expiration or early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.