- Church & Dwight Co., Inc. (NYSE: CHD) announced it has completed the acquisition of Matrixx Initiatives — which is the owner of the ZICAM brand — for $530 million
Church & Dwight Co., Inc. (NYSE: CHD) announced it has completed the acquisition of Matrixx Initiatives — which is the owner of the ZICAM brand — for $530 million. This acquisition was structured as a stock purchase that Church & Dwight financed with a combination of cash and debt.
Zicam is known as the #1 zinc supplement in the US in the VMS (vitamins, minerals, and supplements) cough/cold shortening category. And Zicam shortens the duration of a cold using zinc as the core active ingredient.
Zicam’s annual net sales are projected to be about $90 million in 2021 and EBITDA is expected to be approximately $36 million. And once Zicam is fully integrated, Church & Dwight expects to leverage its distribution network, operating discipline, and support functions to generate anticipated annual cost savings of approximately $5 million by 2022.
Zicam is expected to be about 3% accretive to cash earnings in 2021. And the acquisition is expected to be neutral to Q4 2020 earnings per share (EPS) and neutral to 2021 EPS due to intangible amortization, interest expense, transition expenses, and higher marketing spending.
KEY QUOTES:
“The acquisition of Zicam represents a superb addition to our existing portfolio and brings to our Company the leading brand within zinc supplements, one of the fastest-growing sub-segments of the VMS category.”
“This acquisition meets the Company’s long-standing acquisition criteria. Specifically, Zicam is a (1) #1 brand in a niche category; (2) asset-light; (3) a growing brand, and (4) expected to be gross margin accretive to the Company. We are excited about adding the Company’s 13th power brand. Acquisitions have been a key driver of Church & Dwight’s consistently strong shareholder returns.”
— Matthew Farrell, Chairman and Chief Executive Officer of Church & Dwight.
