Newell Brands Inc (NYSE:NWL) shares were on the rise on the company’s latest acquisitions.
The company is shelling out $470 million for Sistema Plastics, a company responsible for making plastic food storage container units, including the Rubbermaid brand. Newell said the move will help it improve its portfolio.
The other acquisition recently announced by the company is Smith Mountain Industries, which is a candlemaker that will cost $100 million. Both companies are growing faster than Newell’s core business, according to reports.
Earnings are expected to be improved significantly immediately. Both the Sistema and the Smith Mountain deals will be completed with cash on hand very soon.
The move is part of a broader effort by the company to simplify its operating structure as Newell will sell off about 10% of its portfolio. The company’s 32 business units will be reduced to 16 operating divisions, including a new e-commerce business.
Sistema’s annual sales amount to about $145 million. Meanwhile, Smith Mountain Industries has amassed annual sales amounting to approximately $65 million.
NWL stock grew 2% Monday.
