Whole Foods Splits Stock, Sells NatureSmart to NBTY
05/28/2001
Whole Foods Splits Stock, Sells NatureSmart to NBTY
AUSTIN, Texas--Whole Foods Market Inc. (NASDAQ:WFMI) followed a solid first quarter earnings report with news that its board of directors approved a two-for-one stock split, as well as the sale of its NatureSmart subsidiary (formerly Amrion Inc.) to NBTY Inc. (NASDAQ:NBTY) for $28 million in cash.
The stock split will be effective June 4 for all shareholders on record as of May 21. Each shareholder will receive one new WFMI common share for every share owned. "This stock split will benefit shareholders by increasing the liquidity and marketability of our stock and is thus in line with our goal of creating value for our shareholders," said John Mackey, chief executive officer. After the split, about 54.6 million shares will be outstanding.
Whole Foods also expects the sale of NatureSmart to NBTY will favor good future earnings results, as the complex subsidiary led a $24 million loss for WFMI in late fiscal 2000. NatureSmart, which is part mail order business, part nutritional supplement manufacturer and part private-label manufacturer, recorded $59 million in annual sales for fiscal 2000 and lists assets totaling $19 million. Upon completion of the deal, NBTY will sign a lease on the Thornton, Colo.-based facility that houses NatureSmart, though the building is still held for sale by Whole Foods. The two companies are still in negotiations for the continued supply of some products manufactured by NatureSmart for Whole Foods' private-label supplement line.
For
NBTY, the acquisition is expected to strengthen the company's direct response vitamin sales, while providing new marketing opportunities by offering products directly to healthcare professionals. NBTY anticipates using its size and experience to reduce the costs of manufacturing, printing and mailing at
NatureSmart.
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