Canaccord Genuity Advises Foundation Consumer Healthcare on Sale of Brands Portfolio

Foundation Consumer Healthcare, a portfolio company of Kelso & Company and Juggernaut Capital Partners, has agreed to sell a portfolio of over-the-counter consumer health brands, including Breathe Right, to publicly traded Prestige Consumer Healthcare at an enterprise value of $1.045 billion.

Pittsburgh-headquartered Foundation Consumer Healthcare (FCH) develops and markets a portfolio of over-the-counter respiratory, pediatric, and oral care medicines. The divested assets include Breathe Right nasal strips, Children’s Dimetapp cough and cold products, and Anbesol oral pain treatments, as well as additional brands including Alavert, Dristan, Primatene Tablets, FiberCon, Campho-Phenique, St. Joseph Low Dose Aspirin, and Bronkaid.

According to FCH, the portfolio of divested brands generates approximately $200 million in revenue and $95 million in EBITDA. Based on the enterprise value of $1.045 billion and the $95 million in EBITDA for the acquired brands, this equates to an EBITDA valuation multiple of 11.0x.

“We are proud to have advised Foundation Consumer Healthcare and the Kelso and Juggernaut teams on a transaction that reflects the enduring value of these iconic consumer health brands,” said Fuad Sawaya, the vice chairman and global head of consumer investment banking at Canaccord Genuity. “Breathe Right is the rare brand that is truly synonymous with its category with a global footprint, and Prestige is the ideal long-term home given their proven track record of building OTC franchises. This transaction is a testament to our client’s stewardship of the portfolio and a well-executed process that enabled an exceptional outcome.”

Canaccord Genuity (TSX: CF) is an independent, full service financial services firm, with operations in two principal segments of the securities industry: wealth management and capital markets. The firm’s capital markets division offers institutional and corporate clients investment banking, merger and acquisition, research, sales and trading services from offices across North America, the United Kingdom, Europe, Asia and Australia, with sector coverage in healthcare, technology, consumer and industrials. Canaccord Genuity was founded in 1950 and is headquartered in Toronto.

The sale of these brands allows FCH to focus its efforts on its women’s health business, which is anchored by its Plan B One-Step emergency contraception brand.

“We’ve made the strategic decision to focus on women’s health,” said Greg Bradley, CEO of FCH. “Plan B One-Step has a long-standing heritage in the emergency contraception space. This decision enables us to unlock additional value for the company and explore new partnerships and opportunities in which to grow this portfolio.”

Prestige Consumer Healthcare (NYSE: PBH) is a marketer, manufacturer, and distributor of over-the-counter healthcare and household cleaning products. The company’s portfolio includes consumer brands across categories such as pain relief, gastrointestinal health, eye and ear care, motion sickness, and women’s health, with products sold through mass retailers, drugstores, grocery chains, e-commerce platforms, and international distribution partners.

Prestige operates through a brand management model focused on acquiring, integrating, and scaling underinvested or non-core consumer health brands. The company’s brand portfolio includes BC Powder, Goody’s, Dramamine, Monistat, Chloraseptic, and Clear Eyes. Prestige was taken public in February 2005 following its ownership by GTCR, which had acquired the business in 2004.

New York City-based Kelso & Company is one of the oldest and most established firms specializing in middle-market private equity investing. Since 1980, Kelso has invested more than $19 billion of equity capital in more than 140 transactions. In October 2023, Kelso held an above-target close of Kelso Investment Associates XI LP with capital commitments of $3.25 billion. Included in Fund XI’s capital is participation by Kelso partners and employees of more than $400 million.

Juggernaut Capital Partners makes control or minority equity investments of $10 million to $50 million in North America-based consumer and healthcare companies with revenues from $15 million to $150 million. The Washington DC-based firm, founded in 2009 by John Shulman, a former managing director at Allied Capital, is currently investing out of its $419 million fourth fund.