Sharpie, Crock-Pot, other brands combined in merger
Consumer goods giant Newell Rubbermaid on Friday closed its acquisition of Jarden, creating a $16 billion product conglomerate with wide-ranging brands such as Sharpie, Coleman, Rawlings, Sunbeam and Crock-Pot.
The deal was worth $15.4 billion, or $13.2 billion when excluding convertible debt. The combined company will be known as Newell Brands.
Newell Rubbermaid CEO Michael Polk, who becomes CEO of the new company, said Friday in an interview he will emphasize cost-cutting measures and will assess the future of the company's numerous brands.
The company did not divest any assets as part of the deal for Jarden, but Polk didn't rule out sales moving forward.
"Our portfolio strategy is something we’ll work on right away," he said. "We will not allocate resources across these businesses democratically."
Polk said the acquisition did not encounter any regulatory hurdles despite the Obama administration's recent move to block various deals on anti-trust grounds.
Polk said the combination brings together two companies with complementary portfolios of products, but he said corporate administrative overlap and combined purchasing power will deliver an estimated $500 million in cost cuts over the next four years.
He acknowledged that job losses are inevitable, though he declined to specific how many or where they will occur.
The newly combined company will focus principally on writing products, baby and parenting, tools and commercial products, cookware and kitchen appliances, and sporting goods, recreation and outdoor living.
The writing area has been particularly hot, posting 10.9% core-sales growth in 2015, fueled by the adult coloring book boom. Newell's colored-pencil business "has been on fire as a result of that underlying consumer phenomenon," Polk said.
Enhancing online sales strategies is critical to the merger's success. Polk said Newell Rubbermaid's online operation was successful through store websites and Amazon, while Jarden had success in direct-to-consumer sales.
Each company can benefit from the other's approach, he said.
"There’s an opportunity to invest in both," Polk said. "We have to reach customers where they shop."
Newell's Michael Cowhig will remain in the role of non-executive chairman of the new company. Martin Franklin, the founder and executive chairman of Jarden, will join the board of the company. Jarden CEO James Lillie is stepping down.
Newell Rubbermaid shares closed Friday at $44.33, up 14 cents or 0.3%.
Follow Paste BN reporter Nathan Bomey on Twitter @NathanBomey.