Axa Private Equity and German-based Triton sold pet food producer Tetra to US-based battery producer Rayovac for approximately €415m. It is understood that Triton acquired the entire share capital of Tetra from pharmaceutical company Pfizer in 2002 for a total consideration of €238.5m. Axa acquired a 22% stake in Tetra Holding in 2003.
Rayovac expects the acquisition to add slightly to its earnings within the first year before any cost savings from the deal. Although analysts said Rayovac was paying a full price, the company’s shares reacted positively to the news. Rayovac shares traded up this week by 10% to US$42.25.
Under Axa and Triton’s ownership, Tetra’s sales have risen by around 5% a year over the last four years. The fish and aquarium business is expected to grow at a rate of 4% to 5% in the near-term, with the pet food business expected to grow by 6% a year overall in future.
Headquartered in Melle, Germany, Tetra has about 700 employees and generates approximately €200m in annual net sales. “The combination of Tetra with our United Pet Group business means Rayovac becomes the world’s largest manufacturer of pet supplies,” said David Jones, Rayovac’s chairman and chief executive officer.
The deal follows Rayovac’s US$1.2bn acquisition in February of privately held United Industries, which markets pet supplies in North America, as well as lawn and garden care products. That firm was acquired from private equity seller Thomas H Lee.
Citigroup Global Markets served as financial adviser to Rayovac, while JP Morgan Securities gave financial advice to the vendors. Rayovac said recently that it would change its name to Spectrum Brands.