April 28, 2015 / 9:20 PM / 4 years ago

Spectrum Brands to buy car care products maker for $1.4 billion

(Reuters) - Consumer products company Spectrum Brands Holdings Inc (SPB.N) agreed to buy Armored AutoGroup Parent Inc, a maker of car care products, for $1.4 billion from private equity firm Avista Capital Partners.

Spectrum Brands expects to fund the acquisition with $900 million of debt and about $500 million of its common stock, which includes equity to be bought by parent HRG Group Inc HRG.N.

Armored AutoGroup owns the Armor All car wipes and STP oil brands, and is expected to record sales of more than $440 million in 2015, Spectrum Brands said in a statement.

Spectrum Brands expects the deal to raise its revenue, margins and profit and add over $60 million in free cash flow, a full fiscal year after closing.

The deal was first reported by Bloomberg on Tuesday.

“Armored AutoGroup sells into many of the same retail channels as our current businesses, increases our presence in home improvement centers, and gives us an additional platform for global growth,” Spectrum Brands Chief Executive Andreas Rouvé said.

The company said it has received debt financing commitments from Credit Suisse, Deutsche Bank and Jefferies, and expects the deal to close before July.

Credit Suisse and Deutsche Bank acted as financial advisers, and Paul, Weiss, Rifkind, Wharton & Garrison LLP, and Baker & McKenzie LLP acted as legal advisers to Spectrum Brands.

J.P. Morgan and Morgan Stanley served as financial advisers to Armored AutoGroup while Kirkland & Ellis LLP served as its legal counsel.

Reporting by Ramkumar Iyer in Bengaluru; Editing by Robin Paxton, Bernard Orr

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