CONSUMER goods giant Unilever today unveiled a deal worth £2.3 billion to add VO5 shampoo and Simple soap to its line-up of hair and skin care products.
Unilever, which already owns brands such as Dove, Sunsilk, Pond’s and Vaseline, said the proposed acquisition of Alberto Culver would make it the world’s leading company in hair conditioning and second largest in shampoo.
Other products in the Alberto Culver portfolio include hair care brands TRESemme, Nexxus and St Ives. The business began life as a one-product company in 1955 and its founder Leonard Lavin continues to be a director, while his family are also key shareholders in the Illinois-based firm.
The business, which has operations in nine countries and employs around 2,700 people, generated sales of 1.6 billion US dollars (£1 billion) in the year to the end of June.
Unilever chief executive Paul Polman said the acquisition added some "powerful" new brands to the company’s portfolio.
He added that the addition of VO5, TRESemme and Simple would enable its UK business to cover more price points across a number of categories.
Unilever’s other brands include Knorr, Hellmann’s and Flora, while in September last year it added bath products Sanex and Radox following a deal worth £1.15 billion with US-based firm Sara Lee.
Today’s acquisition is subject to regulatory approval and the backing of Alberto Culver shareholders.
Mr Polman said the personal care category represented 20% of turnover 10 years ago but had grown to reach more than 30% with strong positions in many emerging markets.
"Bolt-on acquisitions such as Alberto Culver supplement organic growth and add powerful new brands to our portfolio," he added.
The acquisition received support in the City as Unilever shares rose by more than 2% today.
Panmure Gordon analyst Graham Jones said "significant but as yet undisclosed synergies" were likely to make the deal price look more reasonable.
He added: "The deal fills out Unilever’s presence in hair care, giving it a better offering across the price points and makes it global leader in hair conditioning, global number two in shampoo and number three in styling."