Yellow Wood Partners has agreed to acquire the North American beauty and personal care brand, Suave, from publicly traded Unilever. Suave will continue to be owned and operated by Unilever outside of the United States and Canada.
Suave’s branded products are used by women, men, and children and include shampoos, conditioners, treatments and serums, body washes, antiperspirants and deodorants, and skin care lotions.
Suave was founded in the 1930s and was one of the first brands to bring salon-quality hair care to the general public. Today, Suave products are sold through mass retailers and on e-commerce platforms.
“We look forward to bringing a significantly increased level of brand investment as well as operational focus to leverage Suave’s high brand recognition and value proposition to major retailers and consumers in North America,” said Tad Yanagi, a partner of Yellow Wood. “Working with Unilever allowed us to formulate a transition plan to build a more focused stand-alone company as we have done in the past with other carve-outs from multinational CPG companies.”
Carve out transactions with consumer products companies are not new to Yellow Wood. In November 2019, the firm formed Scholl’s Wellness Company to purchase Bayer’s Dr. Scholl’s business, a footwear and orthopedic footcare brand founded by Podiatrist William Mathias Scholl in 1906 in Chicago, for $585 million. In February 2021, Yellow Wood acquired the Scholl footcare brand, which operates globally outside of the Americas, from consumer-goods company Reckitt Benckiser. The buy of Scholl reunited the business with the Dr. Scholl’s brand after 37 years of separate ownership.
“This is another step on our path to shift our portfolio towards strategic growth spaces,” said Esi Eggleston Bracey, the president of Unilever USA and CEO of Unilever Personal Care North America. “Suave has been a much-loved brand since the 1930s, and I am confident it will continue to thrive and serve consumers under its new ownership in North America.”
Unilever (NYSE: UL) is a multinational consumer goods company that produces and sells food, beverages, cleaning agents, and personal care products. The company’s products are sold in over 190 countries, and it has more than 400 brands in its portfolio, including well-known names such as Dove, Knorr, Vaseline, Ben & Jerry’s, Lipton, Axe, and Hellmann’s. Unilever was founded in 1929 and is headquartered in London, United Kingdom, and Rotterdam, Netherlands.
“We are excited to have created a strong working relationship with Unilever in this transaction,” said Dana Schmaltz, a partner at Yellow Wood. “Yellow Wood’s intense focus on investing in and operating consumer brands led us to purchase the iconic Suave brand in North America from Unilever. Suave is ubiquitously recognized for its long history of providing accessible, high-quality beauty products to American consumers dating to the 1930s and we are excited to add it to our portfolio of investments. We especially want to thank Unilever for their collaboration as we move forward to completing this carveout. We believe our extensive experience with divestitures of large and small brands from multi-national consumer branded companies such as Bayer and Reckitt will help us successfully transition and grow Suave as a focused brand in the Yellow Wood portfolio.”
Yellow Wood invests in consumer brands and companies that operate in the mass, drug, food, specialty, value, club, and e-commerce channels, and have EBITDA from $10 million and $50 million.
In April 2022, Yellow Wood closed Yellow Wood Capital Partners III LP at its hard cap with $750 million of limited partner capital commitments. Fund III was oversubscribed and included commitments from many of Yellow Wood’s long-time limited partners. Yellow Wood’s earlier fund, Yellow Wood Capital Partners II LP, closed in July 2017 with an oversubscribed $370 million of committed capital.
Houlihan Lokey was the financial advisor to Yellow Wood on this transaction which is expected to close by the end of the second quarter.
© 2023 Private Equity Professional | February 16, 2023
