Duracell, rival eye former Union Carbide operation
The world’s two biggest battery companies — one with its main research lab in Bethel — are bidding for Eveready Industries India, which was once owned by an affiliate of the former Danbury conglomerate Union Carbide.
Duracell parent company Berkshire Hathaway is exploring a bid for Eveready Industries, according to the Indian publication the Business Standard, which did not identify its sources. The Business Standard reported St. Louis, Mo.-based Energizer Holdings as also interested in a deal, as well as multiple, unnamed private-equity investment firms.
Energizer makes batteries under the Eveready brand in the United States and China, while having no ownership interest in Eveready Industries India. Eveready’s India manufacturing dates back to the eve of World War II; in 1968, Union Carbide opened a battery factory in Bhopal, where a separate company pesticide plant had a massive chemical discharge in 1984 that killed thousands of people, ultimately precipitating Union Carbide’s bankruptcy dissolution.
The Business Standard report sparked a surge in shares of Eveready Industries India which are traded on the National Stock Exchange of India, even though Berkshire Hathaway and Energizer provided no confirmation of any interest in the company.
In early January, Energizer completed the $2 billion acquisition of Rayovac from Spectrum Brands, pushing it closer to overtaking Duracell as the top seller of batteries in the world.
The Eveready name dates to 1905, six years after David Misell patented the idea for what would become the modern flashlight, with the company folded in 1917 into the entity that would become Union Carbide. As Union Carbide’s legal woes mounted after Bhopal, the company sold Eveready in 1986 to Ralston Purina, which would spin it back off in 1992 as Energizer.
The Indian manufacturing operations had been carved out previously in an auction overseen by the Indian courts after Bhopal.
Eveready Industries India is based in Kolkata today, with Williamson Magor Group holding a 45 percent stake and the company making about 1.3 billion batteries and flashlights annually. Cheaper carbon zinc batteries dominate its 50 percent market share in India. Last week, the Times of India reported Williamson Magor’s intent to solicit offers for the battery maker, with Eveready Industries India valued at the time between $420 million and $560 million.
Duracell was long based in Bethel under former owner Procter & Gamble and still has its main research center there today. Berkshire Hathaway established a corporate office for Duracell in Chicago after acquiring the brand in February 2016, where Duracell CEO Thom Lachman works.
Under Berkshire Hathaway, Duracell has yet to make a deal to match that of Energizer in its acquisition of Rayovac from Spectrum Brands. Duracell incurred an $89 million loss in 2016 in part due to merger-related costs of its transfer to Berkshire Hathaway, but the unit has increased earnings and revenues since, save for the third quarter of last year when Berkshire Hathaway reported a dip in Duracell sales.