Smart Balance Completes Acquisition of Udi's Healthy Foods, LLC
03 July 2012 - 2:00AM
Smart Balance, Inc. (Nasdaq:SMBL) today announced it completed its
previously announced acquisition of Udi's Healthy Foods, LLC
(Udi's) for $125 million in cash from majority unit holder Hubson
Acquisition, LLC, an affiliate of E&A Industries based in
Indianapolis, the family of founder Udi Bar-on, and other minority
unit holders. Total consideration, including transaction fees and
other ordinary related adjustments, was approximately $126 million
in cash, subject to a final working capital adjustment.
The acquisition, as well as the refinancing of existing
outstanding debt, was financed with the proceeds of a new $280
million senior secured credit facility. The facility, which has an
overall effective interest rate of approximately 7.5% is comprised
of a $240 million term loan scheduled to mature in July of 2018 and
a $40 million revolving credit facility scheduled to mature on June
30, 2017. As of the close of the transaction, the Company's net
debt is approximately $237 million.
The credit agreement, which includes the specific terms and
covenants governing the Company's credit facility, will be included
in a Current Report on Form 8-K to be filed by the Company with the
Securities and Exchange Commission.
Commenting on the announcement, Chairman and Chief Executive
Officer Stephen Hughes stated, "We are excited to include Udi's
Healthy Foods in our portfolio of health and wellness brands and
believe this transaction to be transformational to our company, as
it positions Smart Balance as a leader in gluten-free, accelerates
our growth rate, and further diversifies our mix toward high-growth
natural brands. As a result, we expect the Company's organic
revenue growth rate to accelerate, and we look forward to providing
our initial outlook on Udi's in connection with our second quarter
call on August 2, 2012."
BMO Capital Markets and Citigroup acted as joint-lead arrangers
in financing the transaction.
The Company granted option awards for a total of 957,500 shares
of common stock to 65 of Udi's employees as an inducement to join
the Company in connection with the acquisition. The awards
were granted under a newly adopted Smart Balance, Inc. 2012
Inducement Award Plan. The options have a ten year term and an
exercise price equal to the fair market value of Company common
stock on the date of grant. The options vest in four equal
annual installments beginning on July 2, 2013, the first
anniversary of the grant date.
Forward-looking Statements
Statements made in this press release that are not historical
facts, including statements about the Company's plans, strategies,
beliefs and expectations, are forward-looking and subject to the
safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. These statements may include use of the words
"expect", "anticipate", "plan", "intend", "project", "may",
"believe" and similar expressions. Forward-looking statements
speak only as of the date they are made, and, except for the
Company's ongoing obligations under the U.S. federal securities
laws, the Company undertakes no obligation to publicly update any
forward-looking statement, whether to reflect actual results of
operations, changes in financial condition, changes in general
economic or business conditions, changes in estimates, expectations
or assumptions, or circumstances or events arising after the
issuance of this press release. Actual results may differ
materially from such forward-looking statements for a number of
reasons, including (i) the Company's ability to: maintain and grow
those revenues derived from our Smart Balance® buttery spread
products from which we generate a substantial portion of our
revenues; maintain margins during periods of commodity cost
fluctuations; introduce and expand distribution of our new
products; meet marketing and infrastructure needs; respond to
changes in consumer demand; respond to adverse publicity affecting
the Company or industry; maintain our performance during difficult
economic conditions; comply with regulatory requirements; maintain
existing relationships with and secure new customers; continue to
rely on third party distributors, manufacturers and suppliers;
successfully integrate and operate the Glutino business and realize
the expected benefits of the Glutino acquisition; operate outside
of the U.S.; successfully maintain relationships with the
co-packers for our Glutino® and Gluten-Free Pantry® products; grow
net sales in a competitive environment and with increasingly price
sensitive consumers; and maintain volume in light of price
increases stemming from rises in commodity costs; (ii) the
Company's ability to successfully integrate and operate the Udi's
business and realize the expected benefits of the Udi's
acquisition; potential changes to future tax rates; unexpected
costs, charges, liabilities, or expenses resulting from the
transaction; potential adverse reactions or changes in business
relationships resulting from the transaction; and the possibility
that Udi's growth may occur at a rate less than the Company
anticipates; and (iii) those other risks and uncertainties set
forth in the Company's filings with the SEC.
About Smart Balance, Inc.
Smart Balance, Inc. (Nasdaq:SMBL) is committed to providing
superior tasting, solution-driven products in every category it
enters. The Company's health and wellness platform consists
of four brands that target specific consumer needs: Smart
Balance for heart healthier diets; Glutino and Udi's for
gluten-free diets; Earth Balance for plant-based diets; and
Bestlife for weight management. The Company markets the Smart
Balance line of products, which avoids trans-fats naturally and
balances fats and/or reduces saturated fats, such as Smart Balance®
Buttery Spreads and Enhanced Milks. The Company's Glutino and
Udi's brands are trusted pioneers and leaders in the gluten-free
category, with a wide variety of great-tasting gluten-free foods
consumers trust across a number of product categories, such as
Glutino® Pretzel Twists and Breakfast Bars and Udi's Gluten Free
Breads. The Company markets the Earth Balance line
of non-GMO plant-based products, which include Earth Balance®
Buttery Spreads, Nut Butters and Soy Milks. The Company also
markets weight management products under
the Bestlife brand, which include Bestlife™ Buttery
Spreads and Sticks. For more information about Smart Balance,
Inc., please visit www.smartbalance.com.
About Udi's Healthy Foods, LLC
Udi's Healthy Foods LLC (Udi's) is a leader in the fast growing
market for gluten-free foods in North America. Udi's markets a
diversified and growing range of gluten-free products under the
well recognized Udi's Gluten Free Foods brand in the retail market,
and since mid-2011, food service channels. Udi's Gluten Free
Foods is a leading brand in gluten-free bread and bakery
products. In addition, Udi's markets other gluten-free
products in the frozen pizza and granola categories.
CONTACT: Media Contact:
Brent Burkhardt
TBC Public Relations
bburkhardt@tbc.us
410-986-1303
Investor Contact:
Carole Buyers, CFA
Senior Vice President Investor Relations
& Business Development
Smart Balance, Inc.
cbuyers@smartbalance.com
303-652-0521 x152
Boulder Brands, Inc. (MM) (NASDAQ:SMBL)
Historical Stock Chart
From Jun 2024 to Jul 2024
Boulder Brands, Inc. (MM) (NASDAQ:SMBL)
Historical Stock Chart
From Jul 2023 to Jul 2024