Clayton, Dubilier & Rice Exits Sally Beauty
Search
Share on twitter
Share on linkedin
Share on print
Share on email

Clayton, Dubilier & Rice Exits Sally Beauty

Clayton, Dubilier & Rice today announced total proceeds of $1.9 billion from its 2006 investment in Sally Beauty Holdings. Including a secondary offering completed today, CD&R has sold all of its 86 million Sally common shares in four underwritten offerings in October 2011, February 2012, May 2012 and July 2012, and a share repurchase by Sally in May 2012, at an average price of $22.68. In November 2006, CD&R invested $571 million to acquire approximately 47.5% of Sally Beauty Holdings, Inc., valued at $6.66 per share, from The Alberto-Culver Company. Post-initial investment, CD&R became the largest single shareholder.

Sally Beauty Holdings is an international specialty retailer and distributor of professional beauty supplies with annual revenues of $3.5 billion. Sally operates primarily through two business units, Sally Beauty Supply and Beauty Systems Group, and is the largest distributor of professional beauty supplies in the U.S. based on store count. The Sally Beauty Supply and Beauty Systems Group businesses sell and distribute through over 4,400 stores, including 185 franchised units, throughout the United States and Puerto Rico, the United Kingdom, Belgium, Canada, Chile, Mexico, France, Ireland, Spain, Germany and the Netherlands. The company is based in Denton, TX (www.sallybeautyholdings.com).

Under CD&R’s ownership, revenues and EBITDA for Sally increased 49% and 101%, respectively, while margins expanded 430 basis points. Sally pursued a number of initiatives to drive earnings growth, including initiatives focused on improving sales productivity at the company’s 4,400-store network, accelerating new store openings, augmenting profitability, growing internationally, and strategically making acquisitions.

CD&R Partners Richard Schnall and Kenneth Giuriceo served as Directors of Sally Beauty, and CD&R Operating Partner James Berges served as Chairman. “Sally Beauty involved the complex carve-out of a non-core distribution business,” said Mr. Schnall. “The company’s strong performance during our ownership was underpinned by solid execution of key operational improvement initiatives, including increasing customer traffic, expanding gross margins and growing the business internationally.”

Clayton, Dubilier & Rice focuses on producing financial returns through building stronger more profitable businesses. Since inception, the firm has managed the investment of more than $17 billion in 52 US and European businesses representing a broad range of industries with an aggregate transaction value of approximately $80 billion. Founded in 1978, Clayton, Dubilier & Rice is based in New York, NY and London, UK (www.cdr-inc.com).

Share on twitter
Share on linkedin
Share on print
Share on email

To search in site, type your keyword and hit enter