Newell Brands (NWL), the maker of consumer goods including Paper Mate, Sharpie and Rubbermaid products, said on Tuesday it will undergo a series of strategic changes including selling 10% of its portfolio.
The company said it will simplify by consolidating the existing 32 business units to 16 operating divisions, including creating a new global e-commerce division.
“The company will also focus and strengthen its portfolio by holding a number of businesses for sale, using the proceeds primarily to accelerate debt pay down, and creating a platform for future acquisitions that strengthen and scale the company’s core businesses,” Newell Brands said in a statement.
The businesses for sale will represent 10% of the company’s portfolio including its tools segment, winter sports businesses from its outdoor solutions segment and its heaters, humidifiers and fans business from its consumer solutions business. The total 2015 net sales of the businesses held for sale are about $1.5 billion and include about $100 million of previously announced exits or assets held for sale.
The changes come on the heels of a merger between Newell Rubbermaid and Jarden, which the company said gives it a “unique platform” to grow segments including home fragrance, baby products and food storage and preparation.
Newell said sales are already underway and it hopes to complete divestitures in the first half of 2017. Proceeds from the sales will be used to pay down debt and achieve a leverage ratio of 3 to 3.5 times earnings before items. The company has said it hopes to achieve $500 million on cost synergies by the end of 2018.