A subsidiary of Helen of Troy Limited, a designer, developer and worldwide marketer of consumer brand-name housewares, health and home, nutritional supplement and beauty products, is to acquire Hydro Flask and all membership units of Steel Technology, LLC.
Hydro Flask is a designer, distributor and marketer of high performance insulated hydration vessels for active lifestyles. Hydro Flask adds a fast growing brand that has built equity among outdoor and active lifestyle enthusiasts with a product lineup, innovation pipeline and margin profile that complements Helen of Troy’s Housewares segment and extends its reach into the Outdoor and Athletic Specialty, Natural Foods and e-commerce channels.
The Hydro Flask acquisition is an excellent fit with Helen of Troy’s strategic goal of investing its strong cash flow in businesses that can accelerate its profitable growth in categories where it can add value. The purchase price is expected to be approximately USD210 million in cash, subject to certain customary closing adjustments, implying a pre-synergy multiple of less than 12 times projected calendar year 2016 adjusted EBITDA. We expect calendar year 2016 net sales revenue of approximately USD65 – USD70 million. Hydro Flask is expected to be immediately accretive to Helen of Troy’s sales growth rate, gross margin, cash flow, adjusted EBITDA margin and diluted earnings per share.
“We are delighted to announce the acquisition of Hydro Flask, adding a well-respected and fast growing outdoor brand to our thriving Housewares business,” says Helen of Troy CEO Julien Mininberg. “In less than five years, Hydro Flask has become a strong No2 in hydration bottles in the outdoor & fitness channels. The business has more than quadrupled in size since the beginning of calendar year 2014, grew over 50 per cent in calendar year 2015, and has been the key driver behind the majority of the growth of the category itself. Hydro Flask is led by a group of passionate end users who are highly skilled at developing the premium segment of their category and an authentic brand culture with high quality products that delight consumers. Outdoor enthusiasts love Hydro Flask’s stainless steel hydration products, as well as its genuine brand heritage rooted in the outdoor mecca of Bend, Oregon. Hydro Flask’s team will remain in Bend, where its employees live every day with the same love and respect for the outdoors they share with their rapidly growing consumer base.
“Our third acquisition in less than two years, this transaction marks Helen of Troy’s first new brand in its Housewares segment since acquiring OXO in 2004. OXO has since tripled its revenues solely through organic growth and has established a track record of delivering strong margins. We are dedicated to providing innovative consumer products that make everyday living easier. From its founding 25 years ago, the OXO brand has been a hallmark of this mission, recognised globally for how a well-executed Universal Design philosophy creates products that benefit consumers in a growing array of categories ranging from kitchen gadgets to high chairs. Hydro Flask adds another innovative growth brand to this model. Managing Hydro Flask within Helen of Troy’s Housewares segment should allow us to leverage our proven expertise in innovation, product design and category development. We also expect to leverage key Helen of Troy shared services where we can add value such as our larger infrastructure and international footprint, while preserving the qualities of Hydro Flask we admire. We are very pleased to welcome the Hydro Flask management team to the Helen of Troy family, along with the strong partnership they have built with key outdoor channel retailers and major e-tailers, and the foundation for future growth they have created.
