In a smart purchase, a bid had been accepted by SSL, the owner of the Durex condom and famous foot brand Scholl, from consumer products giant Reckett Benckiser. The deal has SSL getting 11.63 pounds a share in cash and shareholders will receive a final dividend of 8p a share for the year to March 31, 2011. The company has chosen this purchase to expand its presence in the health and personal care market. Total sale will be 2.54 billion pounds.
SSL stockholders seem to be pleased with the offer. Gerald Corbett, SSL Chairman stated: “We felt that a price that is a 64 per cent premium to the average share price over the 1st 12 months, and 35 times last year’s earnings, was worthy of consideration by our shareholders.”
Bart Becht, Reckitts Chief Executive, believes the SSL purchase will bring cost synergies of approximately 100 million pounds a year by close of 2012, due to combining sales forces and distribution networks of the two.
Whether there is a counter bid is yet to be seen.