Sales of iPhones may be slowing, but a bidding war is brewing for the nation’s dominant maker of smartphone screen protectors, The Post has learned.
Zagg Inc., which makes protective covers for iPhones, Android phones and other devices, has secured confidentiality agreements from two potential buyers to look at the Midvale, Utah, company’s financials, two sources told The Post.
One of the potential bidders is Acco Brands, owner of Swingline staplers and Artline pens, sources said.
The other bidder is an undisclosed private equity firm that has sent Zagg’s board a letter saying it would pay as much as $9 a share for the company, which also sells keyboards and cellphone cases, sources said.
A $9-a-share offer represents a 60 percent premium to Zagg’s Tuesday closing price of $5.62.
Zagg is distributing sales books to suitors and expects to conclude its auction in November if all goes according to plan, sources said.
The company projects generating $60 million in 2020 earnings before taxes and depreciation and believes it is worth a seven times multiple of that, or $420 million, said a source close to the deal. That would equate to $10.90 per share, the source said.
Zagg declined to comment.
This sale is starting weeks after Zagg cut its 2019 forecast due to a weak smartphone market, and Chinese tariffs sending its share price tumbling.
On Aug. 6, Zagg said it hired Bank of America to explore strategic alternatives and would not comment on it further until the end of the process.
Zagg has a dominant market share in iPhone screen protection and cellphone battery packs, making earnings somewhat predictable and attractive, sources said.
Acco declined comment.