SPB

Spectrum Brands Holdings Inc

Consumer, Event Driven/Special Sit


Presented:01/12/2018
Price:$113.09
Cap:$24.85B
Current Price:$91.56
Cap:$2.57B

Presented

Date01/12/2018
Price$113.09
Market Cap$24.85B
Ent Value$8.41B
P/E Ratio34.07x
Book Value$25.21
Div Yield0%
Shares O/S200.54M
Ave Daily Vol1,478,568
Short Int12.69%

Current

Price$91.56
Market Cap$2.57B
Spectrum Brands Holdings, Inc. engages in the manufacture of diversified consumer products. It produces consumer batteries; residential locksets; residential builders' hardware; plumbing, shaving, and grooming products; personal care products; small household appliances; specialty pet supplies; lawn and garden and home pest control products; personal insect repellents; and auto care products. The firm offers a portfolio of brands including Rayovac, VARTA, Kwikset, Weiser, Baldwin, National Hardware, Pfister, Remington, George Foreman, Black + Decker, Tetra, Marineland, Nature's Miracle, Dingo, 8-in-1, FURminator, IAMS and Eukanuba, Healthy-Hide, Digest-eeze, Littermaid, Spectracide, Cutter, Repel, Hot Shot, Black Flag, Liquid Fence, Armor All, STP, and A/C PRO. The company was founded on July 13, 2018 and is headquartered in Middleton, WI.

Please note, on January 16, 2018, Energizer Holdings announced that it has reached an agreement to buy Spectum’s Global Battery and Portable Lighting businesses for $2bn. As well, Please note, on 07/16/18 HRG Group, Inc. (HRG) merged with Spectrum Brands Holdings, Inc. (SPB). Presented data has been adjusted, but the text may refer to original data.

Publicly traded companies mentioned herein: Energizer Holdings Inc (ENR), HRG Group Inc (HRG), Spectrum Brands Holdings Inc (SPB)

Highlights

The presenter is long HRG Group (HRG), citing optimism about the potential for two deals to unlock value for shareholders in 2018. First, Spectrum Brands (SPB) has announced that it is exploring strategic options for its Batteries (Rayovac) & Appliances business. Second, the unique ownership structure could be collapsed. HRB owns ~59% of SPB, and per the mid-December filing by SPB, the parties appear to be very close to structuring a tax-efficient deal that would see the shareholder bases combined. If the presenter’s model is accurate, SPB+HRB could be worth $160-180 within 6-9 months. The removal of key risks/ overhangs should drive upside for the stock, and downside risk appears to be limited by the influx of capital and performance of the remaining businesses.

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