Scott Rudolph is the chief executive of NBTY, a vitamin...

Scott Rudolph is the chief executive of NBTY, a vitamin manufacturer in Ronkonkoma. (Feb. 9, 2004) Credit: Lee S. Weissman

NBTY Inc., the Ronkonkoma-based vitamin maker that is one of Long Island's largest employers, said Thursday it has agreed to be acquired by the Carlyle Group, a private investment fund based in Washington, D.C., for $3.8 billion, one of the largest such deals this year.

NBTY, the maker of such well-known brands as Nature's Bounty, MET-Rx and Solgar nutritional supplements, has about 2,000 employees on Long Island, and about 14,000 worldwide. The company is the Island's sixth-largest in terms of sales, with revenue of $2.6 billion in its last fiscal year, which ended in September.

The deal amounts to $55 a share for investors, an eye-popping 47 percent premium over the company's closing price Wednesday. NBTY may solicit other bids during a 35-day period. If none comes in higher than Carlyle's, the deal is expected to close by the end of this year, said NBTY president Harvey Kamil in an interview.

"We were approached by Carlyle and it [their offer] was then given to the board of directors," Kamil said. "It's their job to get the best deal for the shareholders and after a full process, it was determined that this was the best offer."

Asked if there were other offers, Kamil said, "There were several things that occurred," but declined to elaborate.

Kamil said he expects no change in NBTY's operations or management as a result of the takeover.

"We see no changes," he said. "Nothing has been discussed in terms of management except that Carlyle has made clear they are impressed with all of the associates of NBTY and the corporate culture."

Sandra Horbach, a Carlyle managing director, said in a statement that "NBTY is an outstanding business with well-established brands. . . . We are impressed with the business."

Lawrence Solow, who follows NBTY for the investment-banking firm CJS Securities in White Plains, said the company received "a pretty fair price" from Carlyle. "It makes sense," Solow said of the deal, which provides NBTY with a wealthy parent.

Until Wednesday, NBTY's stock was down about 14 percent this year. Shares plummeted April 27 after NBTY reported earnings that were short of analysts' expectations. NBTY closed Thursday at $53.74, up $16.27, or 43 percent.

Part of the purchase price financing comes from equity from Carlyle Partners V, a $13.7-billion U.S. buyout fund. The rest will be paid for by debt financing provided by Bank of America Merrill Lynch, Barclays Capital and Credit Suisse, the company said.

"This transaction delivers exceptional value to our shareholders," NBTY chairman and chief executive Scott Rudolph said. "For our wholesale and retail customers, our commitment to quality and innovation will continue to be our focus. We will leverage Carlyle's global resources and consumer sector knowledge to further drive the company's global growth."

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