Posted Monday, July 14, 2008, 6:35 p.m., EST

Spectrum Brands Inc. of Atlanta and Salton Inc. of Miami, Fla., have terminated their definitive agreement to have Salton acquire Spectrum’s United Pet Group business after Spectrum was unable to obtain approval from its senior lenders.

As part of the termination, Spectrum will pay $3 million to Salton as a break-up fee and is free to pursue other options for reducing its debt load.

“Despite our desire and diligent efforts to complete this transaction upon the negotiated terms, we have been unable to obtain the consent of our senior lenders necessary to close on a basis that would be in the best interests of our shareholders and the company,” said Kent Hussey, chief executive officer of Spectrum. “We will therefore continue to operate the global pet supply business and work to capture the strong market potential we see there.”

Hussey said Spectrum had “sufficient liquidity to run our businesses” based on $72.7 million in cash as of June 29, plus expected 2008 growth for both sales and EBITDA (earnings before interest, taxes, depreciation and amortization). <HOME>