Reckitt Benckiser signs agreement to acquire Schiff Nutrition

Consumer goods company Reckitt Benckiser has announced that it has signed an agreement to acquire US-based vitamins and nutrition products manufacturer Schiff Nutrition for $1.4bn.

The British company said the deal would aid its health care business in the US, where it already sells brands such as Mucinex, Delsym, Cepacol and Durex.

Reckitt Benckiser chief executive officer Rakesh Kapoor said the firm is happy on reaching a mutually beneficial agreement with Schiff and is excited to enter the $30bn global vitamins, minerals and supplements market.

"The sub-categories within which Schiff operates have strong growth momentum and to this we expect to combine Reckitt Benckiser’s strong go to market capabilities as well as proven skills in branding, innovation and consumer communication and education," Kapoor added.

Reckitt Benckiser earlier announced a cash tender offer of $42 per share and the offer will expire on 14 December 2012, unless extended in accordance with the merger agreement and the applicable rules and regulations of the SEC.

Reckitt Benckiser will finance the transaction with cash and existing credit facilities.

The transaction is expected to close before the end of calendar year 2012.

Once the transaction is completed, Schiff’s earnings will be added to the Reckitt Benckiser on an adjusted basis.

The transaction took place with Morgan Stanley serving as exclusive financial advisor to Reckitt Benckiser, while Paul, Weiss, Rifkind, Wharton & Garrison served as the legal advisor.

Schiff Nutrition is a US-based vitamins and health care products manufacturer, whose portfolio includes MegaRed, Move Free, Airborne and Schiff Vitamins.