United Industries Signs Definitive Agreement to Acquire United Pet Group

 

ST. LOUIS, MO, June 15, 2004 - United Industries Corporation, which goes to market as Spectrum Brands, today announced that it has entered into a definitive agreement to acquire United Pet Group, Inc. ("UPG"), a privately owned leading manufacturer and marketer of premium branded pet supplies, for $360 million. UPG, headquartered in Cincinnati, will operate as a separate division of United Industries and will continue to be led by UPG CEO John Heil. The combined companies will have projected annualized sales of approximately $1 billion.

 

The acquisition, United Industries' fifth in three years, will diversify the company's product offering and customer base while reducing its exposure to seasonal demand and weather conditions in key markets. UPG is one of the largest companies in the $8 billion pet supplies industry, which is expected to grow at 6-8% a year. UPG is currently owned by TA Associates, Friend Skoler & Co., Inc. and management.  Bob Caulk, United Industries' Chairman and CEO, said, "We are very excited about entering a new, fast-growing consumer business. UPG is a great company, with exceptionally strong management and leading product positions. We are counting on this team to continue its strategy of building strong customer relationships, launching exciting new products and consolidating a fragmented pet supplies industry. This transaction broadens United Industries' customer base in North America, smoothes the seasonality of our overall business and provides access to the rapidly expanding consumer pet category."

 

John Heil, CEO of UPG, said, "We are excited to join the United Industries portfolio and look forward to continued growth of our business both organically and through acquisitions."  "John Heil and his team have done an outstanding job building value for UPG's shareholders, employees and customers," said Michael Wilson, a Principal at TA Associates, UPG's majority investor. "We wish UPG management and their new owners continued success in the future."

 

Charles Brizius, Managing Director of Thomas H. Lee Partners, United Industries' largest investor said, "Under the leadership of Bob Caulk and his management team, United Industries has achieved strong revenue growth through increased penetration of the consumer marketplace and a value-oriented marketing strategy grounded in strong brands. In addition to organic growth, the company has successfully integrated four acquisitions in less than three years, making United Industries one of the top two consumer products companies in the growing area of consumer lawn and garden products. The UPG acquisition broadens United's customer base, diversifies its brand portfolio and expands its platform for growth. UPG and its management team will be valued additions to the company's success in the future."

 

The transaction is expected to be financed through a combination of debt and equity, with such financing commitments provided by Bank of America and Thomas H. Lee Partners, respectively.

 

United Industries Corporation

 

United Industries Corporation, which goes to market as Spectrum Brands (www.spectrumbrands.com), is the leading manufacturer and marketer of value-oriented products for the consumer lawn and garden care and insect control segments in the U.S. The company's household brands include Hot Shot®, Cutter® and Repel®. The company's lawn and garden brands include Spectracide®, Garden Safe® and Real-Kill® in the controls category as well as Sta-Green®, Vigoro®, SchultzT, Peters®, Bandini® and Best® brands in the lawn and garden fertilizer and organic growing media categories. Through its Canadian subsidiary, Nu-Gro, the company manufactures and markets category-leading brands such as Wilson®, CIL®, Golf-Green®, and Green Earth®. The company is also a leading global supplier of slow release nitrogen and other fertilizer technologies under brand names such as Nitroform® and Nutralene®. Founded in 1969, the company is headquartered in St. Louis, Missouri. (Bloomberg Symbol: 14496Z)

 

United Pet Group, Inc.

 

Based in Cincinnati, Ohio, United Pet Group (www.unitedpetgroup.com) is a leading manufacturer and marketer of premium pet supplies products for dogs, cats, fish, birds and small animals. UPG's products are sold under a number of brand names, including Eight in One®, Nature's Miracle®, Dingo®, Lazy Pet®, Marineland®, Perfecto®, Aquarium Systems®, and Jungle Talk®. Since 1997, UPG has acquired eight companies in the pet food and supplies industry.

 

UPG's Aquatics division, based in Moorpark, California, markets the broadest line in the industry, including integrated aquarium kits, stand-alone tanks, filters and filter media, sea salt, and other aquarium supplies and accessories. The Aquatics division also markets equipment for use by retailers in the sale of live fish and lobsters. The company's aquatics brands, which include Marineland®, Perfecto®, and Instant Ocean®, are leading brands in their market segments.

 

UPG's Specialty Pet division, based in Hauppauge, New York, markets pet treats and supplies for dogs, cats, birds and small animals under the Eight in One®, Nature's Miracle®, Dingo®, Lazy Pet®, St. Aubrey®, Wild Harvest® and One EarthT brand names.