aibioPrestige Consumer Healthcare closes $1.045 billion Breathe Right acquisition, signs new term loan
Tickers PBH
Prestige Consumer Healthcare (NYSE: PBH) completed the Breathe Right purchase for $1.045 billion in cash and entered a Term Loan Credit Agreement. It also raised its asset-based revolver commitments to $225 million.
Key facts
- Company
- Prestige Consumer Healthcare Inc. (NYSE: PBH)
- News type
- Mergers
- Primary source
- Prestige Consumer Healthcare Inc. Form 8-K filed June 16, 2026 (SEC EDGAR)
Prestige Consumer Healthcare Inc. (NYSE: PBH) closed its acquisition of the Breathe Right brand and certain other brands for $1.045 billion in cash on June 12, 2026, and borrowed a new term loan to pay for it. The company reported the closing in a Form 8-K filed June 16, 2026. The 8-K says the term loans, $1.045 billion of them, funded the transactions. A June 15 press release describes a different mix: "a combination of available cash on hand and a completed financing of a new Term Loan B."
The purchase and the loan
Prestige's subsidiary Medtech Products Inc. and its borrowing subsidiary, Prestige Brands, Inc., completed the purchase from Foundation Consumer Brands, LLC and certain affiliates under an asset purchase agreement dated March 19, 2026. On June 12, the borrower also entered into a term loan credit agreement with Citibank, N.A. as administrative agent. Citibank, Barclays Bank PLC, Morgan Stanley Senior Funding Inc., Goldman Sachs Bank USA and RBC Capital Markets are the joint lead arrangers and joint bookrunners.
Term loans bear interest, at the borrower's option, at Term SOFR plus 2.00%, or at an alternate base rate. The base rate is the highest of Citibank's prime rate, the overnight Federal Funds Rate plus 0.50%, and Term SOFR plus 1.00%. Term SOFR is floored at 0%, and the base rate is floored at 1.00%. The borrower must repay 0.25% of the principal each quarter, and that amount includes any further loans drawn for the LaCorium acquisition.
The filing describes a leverage test. Starting with the fiscal year ending March 31, 2028, if the consolidated first lien net leverage ratio is above 2.75 to 1.00, part of the excess cash flow must go to prepay the loans. The agreement also lets lenders accelerate repayment after payment defaults, covenant defaults, cross-defaults, bankruptcy events and other customary triggers.
The LaCorium draw and the revolver
The agreement allows a second draw, on an uncommitted basis, of up to $95.0 million for the previously announced acquisition of LaCorium Health. The filing expects that deal to close in the second quarter of fiscal 2027. Because the draw is uncommitted, the lenders are not obliged to fund it.
Prestige also signed Amendment No. 10 to its asset-based revolving credit agreement. The amendment raised commitments to $225 million and extended the maturity to five years from the closing date. Revolver borrowings can also fund LaCorium if excess availability afterward is no less than the greater of $30,625,000 and 17.5% of the lesser of total commitments and the borrowing base.
What the company says and what it does not
The press release says Breathe Right "will become the company's largest brand" and calls it an iconic No. 1 brand in nasal strips. It says the price is $1.045 billion, or about $900 million net of anticipated tax benefits valued at $150 million. Those are the company's own figures.
The 8-K and the press release describe the funding differently. The 8-K says $1.045 billion of term loan proceeds financed the transactions, together with fees and expenses, while the release mentions cash on hand alongside the new Term Loan B. The release does not say how much cash was used.
On the company's financial results, its annual report for the fiscal year ended March 31, 2026 reports net income of $190.3 million, down from $214.6 million in fiscal 2025. Cash provided by operations was $257.6 million in fiscal 2026, compared with $251.5 million in fiscal 2025.
Set against the new debt, the $190.3 million of fiscal 2026 net income is a fraction of the $1.045 billion borrowed. The new loan is secured by substantially all of the borrower's and guarantors' assets. It sits beside existing 3.750% senior notes due April 1, 2031 and 5.125% senior unsecured notes due January 15, 2028, and the annual report warns that the covenants in those notes and the revolver limit the company's flexibility. At March 31, 2026 the revolver had $182.9 million of borrowing capacity available. The 8-K says financial statements for the Breathe Right business are still to come, and neither document gives the brand's sales or margins.