Empower Brands has made an unsolicited all-cash offer to acquire Helen of Troy, the El Paso-based consumer products company. The offer, made public Wednesday, is at $37 per share and carries an implied enterprise value of about $1.6 billion. Helen of Troy's board said in public filings that the offer substantially undervalues the company and its prospects for growth.
Empower Brands said the offer is a 28% premium over Helen of Troy's Oct. 30 closing share price. David Maura, chairman of Empower Brands, said the offer gives shareholders an opportunity to realize immediate value. Empower said it first approached management in July, proposed $34 per share in August, and raised its offer to $37 on Oct. 12. Helen of Troy rejected both proposals. An affiliate of Empower already owns about 4.5% of the company's shares, according to the proposal.
Empower Brands criticized the company's recent performance, citing an 87% decline in its share price over five years and what it called "persistent revenue challenges." Helen of Troy said its turnaround strategy will generate greater long-term value. The company said its year-to-date net sales rose 4.9% and that it cut total debt by $244 million over 18 months, to $673 million.