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HRG and Spectrum Brands announce $10bn merger
Shares in consumer products company HRG Group picked up as much as 6.29% in early trading on Monday after announcing that it had reached a $10bn merger agreement with Wisconsin firm Spectrum Brands.
The resulting independent public company would have no controlling shareholder but would retain "certain favourable tax attributes of HRG."
Spectrum shareholders were set to be issued a single newly issued share in the combined company in exchange for each one of the shares that they owned prior to the transaction, whereas HRG shareholders would be given a total number shares equal to that which they then held in Spectrum.
The deal would be tax free for both sets of shareholders.
Leucadia National, HRG's largest shareholder, was expected to hold roughly 13% of the combined company, with the firm's legacy stockholders set to own another 45% of the combined company.
"We are pleased to have reached this mutually-beneficial agreement with HRG," said Terry Polistina, chairman of the special committee of Spectrum Brands.
"Under this new ownership structure, Spectrum Brands will be an independent company with a widely distributed shareholder base and improved governance structure," he added.
Spectrum, the parent company of Black & Decker, George Foreman and Rayovac, said the deal, expected to close by July, would not impact the previously announced sale of its battery business to Energizer.
As of 1600 GMT, HRG shares had picked up 4.78% to $16.66 each, while Spectrum had inched ahead just 0.66% to $104.29 per share.