Physicians Formula Receives New Acquisition Offer Valuing It at $67.1 Million

   By Saabira Chaudhuri 
 

Physicians Formula Holdings, Inc. (FACE) said it has received a new acquisition offer from an unnamed third party to buy it for $67.1 million.

The offer comes about three weeks after the cosmetics and skin care company agreed to be taken private by private equity firm Swander Pace Capital in a deal that values it at roughly $65 million.

Physicians Formula's new suitor has offered to acquire it for $4.50 a share, a 22% premium over its closing price on Aug. 14. Swander Pace's $4.25 a share offer was revealed on Aug. 15.

Under its Physicians Formula brand name, launched in 1937, the company markets premium-priced cosmetics products for the mass-market channel. The company says it differentiates itself by addressing skin imperfections through a problem-solving approach, rather than focusing on changing fashion trends. Its products are sold in over 25,000 stores including those operated by Wal-Mart Stores Inc. (WMT), Target Corp. (TGT) and drugstores.

On Thursday, Physicians Formula said it is continuing to engage in discussions and negotiations with the third party who submitted the acquisition proposal. It noted it hasn't changed its recommendations with respect to the its pending deal with Swander as the third party offer is still uncertain. Its board is continuing to evaluate the new proposal.

Physicians Formula's shares closed at $4.37 Wednesday and were inactive premarket. The stock has climbed 37% in the past three months.

Write to Saabira Chaudhuri at [e-mail]

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