Revlon Inc is to acquire Elizabeth Arden Inc for about US$419 million, a wager that uniting two aging cosmetics giants could reinvigorate both companies’ brands.
The US$14-a-share deal values Elizabeth Arden at about US$870 million when debt is included, New York-based Revlon said on Thursday. The cash transaction represents a 50 percent premium to Elizabeth Arden’s closing price of US$9.31.
Revlon, controlled by billionaire Ron Perelman, sees an opportunity to revive the fortunes of Elizabeth Arden, an unprofitable company whose celebrity-branded fragrances have lost favor with consumers. The merger would bring together the 84-year-old Revlon with the 106-year-old Arden business in the hopes that a combined distribution network and marketing strategy could broaden their appeal.
Photo: AP
“We see great opportunities for growth where they are strong and we are not,” Revlon chief executive officer Fabian Garcia said on a conference call.
The deal would allow Revlon to expand its footprint in fragrances and skin care, Garcia said.
The company also sees growth opportunities in key regions that Elizabeth Arden is strong in, such as China and other Asian countries, he said.
Bank of America Corp and Citigroup Inc have committed about US$2.6 billion to help pay for the acquisition and refinance Elizabeth Arden’s debt, Revlon said.
The company expects cost savings of about US$140 million from the merger by eliminating duplicated operations, gaining purchasing power and sharing a distribution network.
Elizabeth Arden shares soared as much as 50 percent to US$14 in late trading after the purchase was announced, in line with the transaction price. Revlon rose less than 1 percent to US$31.30.
In addition to offering skin care and makeup, Elizabeth Arden is known for selling fragrances under names such as Taylor Swift, Britney Spears and Elizabeth Taylor. The celebrity endorsements have not helped the company cope with a competitive market for cosmetics. It posted almost US$400 million in losses during the past two years.
Elizabeth Arden CEO Scott Beattie said on the conference call that the financial strength of the new combined firm would help attract new licenses in perfumes. He also expects the merger to drive growth in some existing fragrance brands that have languished.
Both companies are coping with the shift to e-commerce, something Revlon has done better at so far, L2 Inc analyst Giulia Prati said.
The Eurovision Song Contest has seen a surge in punter interest at the bookmakers, becoming a major betting event, experts said ahead of last night’s giant glamfest in Basel. “Eurovision has quietly become one of the biggest betting events of the year,” said Tomi Huttunen, senior manager of the Online Computer Finland (OCS) betting and casino platform. Betting sites have long been used to gauge which way voters might be leaning ahead of the world’s biggest televised live music event. However, bookmakers highlight a huge increase in engagement in recent years — and this year in particular. “We’ve already passed 2023’s total activity and
Nvidia Corp CEO Jensen Huang (黃仁勳) today announced that his company has selected "Beitou Shilin" in Taipei for its new Taiwan office, called Nvidia Constellation, putting an end to months of speculation. Industry sources have said that the tech giant has been eyeing the Beitou Shilin Science Park as the site of its new overseas headquarters, and speculated that the new headquarters would be built on two plots of land designated as "T17" and "T18," which span 3.89 hectares in the park. "I think it's time for us to reveal one of the largest products we've ever built," Huang said near the
BIG BUCKS: Chairman Wei is expected to receive NT$34.12 million on a proposed NT$5 cash dividend plan, while the National Development Fund would get NT$8.27 billion Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday announced that its board of directors approved US$15.25 billion in capital appropriations for long-term expansion to meet growing demand. The funds are to be used for installing advanced technology and packaging capacity, expanding mature and specialty technology, and constructing fabs with facility systems, TSMC said in a statement. The board also approved a proposal to distribute a NT$5 cash dividend per share, based on first-quarter earnings per share of NT$13.94, it said. That surpasses the NT$4.50 dividend for the fourth quarter of last year. TSMC has said that while it is eager
China yesterday announced anti-dumping duties as high as 74.9 percent on imports of polyoxymethylene (POM) copolymers, a type of engineering plastic, from Taiwan, the US, the EU and Japan. The Chinese Ministry of Commerce’s findings conclude a probe launched in May last year, shortly after the US sharply increased tariffs on Chinese electric vehicles, computer chips and other imports. POM copolymers can partially replace metals such as copper and zinc, and have various applications, including in auto parts, electronics and medical equipment, the Chinese ministry has said. In January, it said initial investigations had determined that dumping was taking place, and implemented preliminary
RSS