THE WHAT? Helen of Troy has announced the acquisition of Curlsmith-owner, Recipe Products for a total consideration of US$150 million in cash, net of cash acquired.
THE DETAILS The tuck-in acquisition complements and enhances the company’s prestige beauty platform and is expected to be immediately accretive to consolidated sales growth, gross profit margin and adjusted EBITDA.
“Helen of Troy has a talent for spotting exceptional indie brands that do things differently, and turbo charging them,” said Michal Berski, Curlsmith Founder and CEO. “So, from the get-go we knew that Curlsmith would be a compelling strategic fit. As a market-leading textured hair care brand, Curlsmith both complements and brings a new dimension to [Helen of Troy’s] already enviable prestige hair care portfolio.”
THE WHY? Julien R. Mininberg, Helen of Troy CEO, commented, “We believe Curlsmith is an excellent fit with Helen of Troy, both strategically and financially. This transaction advances Helen of Troy’s strategy to invest in businesses that can accelerate profitable growth in categories where we can add value and leverage our scalable operating platform. It aligns with a key Phase II M&A objective of tucking in early stage, fast growing, and disruptive innovators to complement our portfolio of Leadership Brands. Curlsmith expands our platform in prestige beauty to capitalize on the fast-growing textured hair market. Approximately 60 percent of US consumers have curly or textured hair. Prestige textured haircare products are growing 10 times faster than products for non-textured hair, and twice as fast as mass market textured hair products. The business more than doubled in size between calendar years 2020 and 2021 and we expect it to continue to grow at a healthy double-digit rate…
“We see excellent upside potential for Curlsmith, and we expect to add significant value to it by capitalizing on our expertise in beauty and our shared services platform. In Beauty, we will be immediately adding capability through a much larger salesforce in brick and mortar and online, additional DTC capability, marketing, category development, appliance know how, and an international go-to-market footprint. Once we complete the necessary integration activities, we expect to add further value to the business and achieve meaningful synergies by leveraging Helen of Troy’s highly capable global sourcing, distribution, and back-office shared service capabilities.”