In the past five years, share price of Newell Brands (NWL) has been a roller coaster. Recently, it reached its 5-year low at $24.7 per share. Two famous activist investors, Carl Icahn and Starboard, owns 6.9% and 4.5%, respectively, of Newell Brands. Let's take a closer look to determine whether we should follow those two activist investors into the company.
Benefits of Jarden Acquisition is not yet materialized
Newell Brands is a global marketer of consumer and commercial products, with many brands including Parker, Paper Mate, Elmer's, Marmot, Oster, Yankee Candle, operating in nearly 100 countries. Dated back 2016, it has made a huge acquisition of Jarden Corporation, paying $13.22 billion, in order to increase the economies of scale, expand the global reach, enable cross-selling opportunities for both companies' products and deliver $500 million in run-rate cost synergy within four years of closing. Newell had expected to achieve annual adjusted EBITDA of more than $3 billion after synergies. Currently, Jarden's portfolio still generates nearly half of Newell's revenue. It is more than two years since the acquisition close, but it seems like there is a lot to be done in order to significantly increase the company's operational efficiencies.
