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Armor All Files for Offering of 3.5 Million Shares

July 27, 1986|BRUCE HOROVITZ

Armor All Products Corp. of Irvine, a subsidiary of San Francisco-based McKesson Corp., has filed with the Securities and Exchange Commission for a proposed public offering of 3.5 million shares of common stock. The company hopes to raise as much as $49 million from the offering.

The offering will represent 16.7% of the common stock of Armor All. The remaining 83.3% of the stock--17.4 million shares--will be retained by McKesson.

The stock is expected to sell initially at $12 to $14 per share, the company said. The offering is being underwritten by Morgan, Stanley & Co. Inc. of New York.

A portion of the proceeds from the offering will be used to repay a loan Armor All took out in order to pay a $15-million dividend to McKesson next month. The remainder of the proceeds will be used to replenish working capital, according to the registration statement filed Friday with the SEC.

Armor All's best-known product is Armor All Protectant, which is used to protect automobile surfaces such as vinyl tops, rubber bumpers and dashboards. The product captured nearly 90% of the protectant segment of the automotive aftermarket last year, according to the registration statement.

Armor All Protectant, which has been sold by the company since 1972, accounts for 93% of the company's sales. The company employs 51 workers, including 26 in management positions.

For the quarter ended June 30, 1986, Armor All posted an 8.7% increase in net income to $4 million from $3.7 million. Revenues grew 21.1% to $25.3 million from $20.9 million.

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