Rayovac to Acquire ROV Ltd.
Rayovac Corp. (Madison, WI) announced it has executed an agreement to acquire ROV Ltd., a privately held battery manufacturer based in Latin America, for $120 million. ROV Ltd. had 1997 sales of $84 million. With the purchase of ROV Ltd., Rayovac will control the Rayovac brand rights for battery products worldwide, with the exception of Brazil. Rayovac expects the acquisition to be financed with a combination of equity and additional borrowings and to close by the end of February 1999.ROV Ltd. was created in 1982 as a spin-off of Rayovac's international operations. The firm currently controls the Rayovac brand rights for Latin America (other than Brazil), Africa, the Middle East and selected Asian countries. According to Rayovac, ROV Ltd. has significant consumer battery market share in Mexico, Central America, the Dominican Republic and Venezuela and other markets in Latin America. The company also serves markets outside Latin America, including the Middle East and Africa."We will be pleased to welcome ROV Ltd. back to the Rayovac family," stated Rayovac Chairman and CEO Dave Jones. "Upon completion of this purchase we will have positioned Rayovac to become a truly global player in the battery market. Latin America is one of the fastest growing battery markets in the world and we believe Rayovac's brand awareness in Latin America is already higher than in North America. ROV Ltd.'s strong distribution position will allow us to market all of our product lines into its markets and assist ROV Ltd. in expanding further into the Mexico, Central and South America, the Middle East, Africa and Asian markets. We expect this transaction to be accretive in the first year with significant growth potential in revenue and earnings over the next several years."Rayovac also announced it has filed a registration statement with the Securities and Exchange Commission for a stock offering of 6 million shares of common stock. Of the total shares being offered, 4 million new shares will be offered by the company, with the net proceeds of the stock sale to partially finance the ROV acquisition. Another 2 million shares will be offered by existing shareholders.