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Physicians Formula to be acquired by Markwins for nearly $75M

BY Antoinette Alexander

ZUSA, Calif. and CITY OF INDUSTRY, Calif. — Physicians Formula and Markwins International announced on Thursday that they have entered into a merger agreement under which Markwins will acquire all of the outstanding shares of common stock of Physicians Formula for $4.90 per share in cash, or approximately $74.9 million.

Physicians Formula also announced that, immediately prior to entering into the merger agreement with Markwins, it terminated its previously announced merger agreement with affiliates of Swander Pace Capital. In accordance with the terms of that previous merger agreement, Physicians Formula is required to pay a termination fee of about $1.29 million to the affiliates of Swander Pace Capital.

The per share price represents a premium of approximately 33% to Physicians Formula’s closing stock price on Aug. 14 (the trading day prior to the announcement that Physicians Formula entered into a merger agreement with affiliates of Swander Pace Capital) and a premium of approximately 40% to Physicians Formula’s one-month volume-weighted average price as of that same date.

The proposed merger with Markwins is expected to close later this year. Upon the closing of the merger, Physicians Formula will be owned by Markwins, and the employees of Physicians Formula will become employees of Markwins. At this time, the employees of Physicians Formula will continue to be located at the company’s existing facilities in Azusa, Calif.

"Our board of directors, following a thorough analysis by its Special Committee, has unanimously determined that the proposed merger with Markwins offers the best value for our stockholders," stated Ingrid Jackel, Physicians Formula chairwoman and CEO. "We are pleased that Markwins has agreed to purchase our company. Markwins and Physicians Formula sell noncompeting brands in similar channels. Combining the resources and experience of both companies will strengthen the combined portfolio of brands."

"Following receipt of Markwins’ acquisition proposal, the Special Committee oversaw negotiations with Markwins that resulted in an increase in the aggregate merger consideration to stockholders of approximately $10 million, or a 15% increase to the Swander Pace offer. We believe this all cash sale of Physicians Formula to Markwins is in the best interests of the stockholders of Physicians Formula," added Thomas Lynch, chairman of the Special Committee.

"The acquisition of Physicians Formula fulfills a strategic Markwins objective to expand and diversify our already robust brand portfolio. We believe this is a synergistic acquisition that creates an immediate opportunity to broaden our consumer base and enrich our retail partnerships," Markwins CEO Eric Chen stated. "Physicians Formula is widely recognized for its innovative beauty solutions and loyal customer base which makes it a natural complement to the ideology of all Markwins brands. Markwins believes this purchase reflects fair value to current shareholders, while delivering on the company’s expectations of high growth and continued global expansion."

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Celestial Seasonings’ Enerji shots give consumers a jolt with green tea

BY Allison Cerra

BOULDER, Colo. — Celestial Seasonings has launched a line of single-serve and shelf-stable energy shots.

Enerji shots combine naturally energizing green tea with a blend of B vitamins and ginseng and do not contain artificial flavors, colors, sweeteners or preservatives. The new shots are packaged in convenient 2.5-fl.-oz. bottles and are available in three flavor varieties: citrus, berry and Pomegranate Xtreme (with more caffeine and B-vitamins than regular Enerji shots).

The energy shot segment is expected to grow 116% in sales between 2011 and 2016, according to Mintel, and Celestial Seasonings expects that the increased popularity of natural shot alternatives will help drive that segment growth.

"We know there’s strong consumer demand for natural energy alternatives, so we’ve added Enerji shots to our natural shot line for consumers who want to enjoy the benefits of energy shot products while still making choices they feel good about," said Blake Waltrip, VP and chief marketing officer at Celestial Seasonings. "As a trusted tea company with a strong history in wellness, we’re very serious about creating innovative products that meet the specific needs of our health-conscious consumers and also reflect our brand’s mission and values."

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Coca-Cola inks new partnership to accelerate global production of PlantBottle packaging

BY Allison Cerra

ATLANTA — Coca-Cola has inked a partnership with JBF Industries to further expand production of the plant-based material used in Coca-Cola’s PlantBottle packaging.

Coca-Cola said the supply partnership will help the company continue its leadership in bringing renewable, lower-carbon plastics to the marketplace and move the company closer to its target of using PlantBottle packaging technology in all of its plastic bottles by 2020.

PlantBottle packaging is available in more than 24 countries worldwide and across a wide variety of Coca-Cola products, the company said. Since the package launched in 2009, its use has eliminated the equivalent of almost 100,000 metric tons of carbon dioxide emissions — the equivalent of 200,000 barrels of oil from Coca-Cola’s PET plastic packaging.

"The benefits of sustainable innovation are only fully realized when commercialized and put in the hands of consumers," Coca-Cola VP procurement and chief procurement officer Ronald Lewis said. "In 2009, we introduced the world to our PlantBottle package — the first recyclable PET plastic bottle made partially from plants. Today, Coca-Cola has sold more than 10 billion PlantBottle packages around the world that are less dependent on petroleum and have a lower carbon impact. We are pleased that our partnership with JBF Industries will help us further expand global production."

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