(By Balaseshan) Physicians Formula Holdings Inc. (NASDAQ: FACE) said Markwins International Corp. has bought all outstanding securities of the cosmetics company for $75.0 million or $4.90 per share in cash.
Physicians Formula stockholders also received a special 3 1/2 cent per share dividend as part of the transaction. The $4.90 per share price represents a premium of about 33% to Physicians Formula's closing stock price on August 14 and a premium of about 40% to its one-month volume-weighted average price as of that same date.
The acquisition of Physicians Formula represents a major step towards Markwins' strategy to add an up-market brand in the "masstige" cosmetics space to its existing dominant entry point wet n wild brand, and become the next major global innovator of beauty products. This is Markwins' second acquisition following its acquisition of AM Cosmetics in 2003.
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Ingrid Jackel, Chairwoman and CEO of Physicians Formula, will become an executive of Markwins and will, along with the rest of her management team, continue overseeing Physicians Formula under Markwins' ownership. Senior debt financing for the transaction was provided by Cathay Bank.
Blackstone Advisory Partners L.P. served as exclusive financial advisor to the Special Committee of the Board of Directors of Physicians Formula and Sheppard Mullin Richter & Hampton LLP served as legal advisor to Physicians Formula in connection with the transaction.
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FACE is trading up 1.45% at $4.90 on Wednesday. The stock has been trading between $2.76 and $5.14 for the past 52 weeks.