Blyth Inc. (NYSE: BTH), a Connecticut-based Home Expressions Company that is engaged in selling an extensive line of scented candles and related accessories, seasonal decorations, home decor and household convenience products, announced that it reached an agreement in principle to defer the final closing of its purchase of the ViSalus business until April 4, 2014.
In 2008, BTH acquired a substantial percentage of shareholdings of ViSalus, a health and wellness company which offers a diverse line of nutritional supplements, energy drinks and weight management solutions. BTH was required to buyout the remaining 27% of ViSalus by next year. But now the company has signed an unbinding agreement with ViSalus to defer the buyout plan till 2014.
According to the agreement, the purchase price of ViSalus will be determined based on its operating Income for the fiscal year ending December 31, 2013. ViSalusâ€™ CEO, Ryan Blair and CMO, Blake Mallen entered into a new employment agreement for a five year term and they along with the companyâ€™s Brand Ambassador Nick Sarnicola will receive stock options and restricted stock units vesting over an eight year term. Senior Management may also receive an equity plan and stock options.
BTH filed registration statement for IPO of ViSalus in August 2012 and withdrew it within a month citing uncertain market conditions. In addition to it, BTHâ€™s outlook has recently been changed to â€śNegativeâ€ť by Moodyâ€™s Investors Service.
Shareholders and Market Experts believe that this is a good move done by BTH, since it had possible liquidity restraints in 2013 from the potential buyout plan and $100 million worth of notes maturing next year. It had responded positively at the market with share prices of BTH rising substantially yesterday.
During the last week, the Company repurchased 283,300 shares, the maximum amount that could be repurchased under SEC rules. CEO, Robert Goergen claimed that it is well under the Board approved limits and it is for the best interests of shareholders.
As per the latest quarterly results for June 2012, BTHâ€™s net revenues were $324.8 million with $18.99 million as operating profit and $8.03 million as net income. Total assets were $525.41 million including $205.99 million worth of cash and its equivalents. Total liabilities were $408.05 million, among which 41% were current and the remaining was long term.
At the last check, BTH shares were trading 2.84% lower at $26.01 with volume up from its daily average of 0.64 million to 0.87 million. The stock opened today at $28.21 and has been trading so far in the range of $25.32 and $28.67.