- 2024-01-30
- 阅读量：5926
- 来源｜Cosmetic Business Online
- 作者｜Liu Jia Hui
The originator of the tube lipstick.
On January 25, Botetourton-based private equity firm Yellow Wood Partmers announced that its portfolio company Suave Brands Company will pay $430 million (roughly Rs. 3.08 billion) to consumer health company Haleon to acquire lip care brand ChapStick. as part of the deal part of the deal, Haleon will own a minority stake in Suave Brands Company worth $80 million (roughly Rs 570 million).The private equity firm said, "ChapStick has the highest brand awareness in the lip care space, as well as the highest purchase conversion rate of any brand in the category. We look forward to closing this transaction in the first half of 2024."
A long-established brand, ChapStick's story dates back to the 1800's. In 1869, a pharmacist and inventor - Dr Chares Browne Fleet - opened a small, home-based apothecary in Lynchburg. He made balms and salves in his apothecary and modified the formulas and ingredients to create products that would help his customers with a variety of ailments, large and small. To prevent and treat dry, cracked lips, Dr. Fleet created what people now call lip balm. The original version of lip balm looked like a small candle without a wick, wrapped in foil. This bulky and inconvenient design was the reason why lip balm struggled to sell at the time.
In 1912, Dr. Fleet sold the lip balm formula and the rights to use it to his friend, Jhon Mrton, for $5. Mr. Mr. Mrton and his wife began brainstorming on how to make ChapStick marketable. While experimenting with the recipe, Mrs. Mrton came up with the idea of pouring the melted ingredients into a copper tube and shaping it into a stick, which could be used to push the product up when it was running out.
The ChapStick was a huge success and Morton built a business empire, Morton Manufacturing Company, on the profits generated by the ChapStick. 1936, as the ChapStick brand began to gain momentum, Morton asked local commercial artist Frank Wright Jr. to design the ChapStick logo, a classic look that is still used today. In 1936, as the ChapStick brand began to gain momentum, Morton asked local commercial artist Frank Wright Jr. to design the ChapStick logo, a classic look that ChapStick carries to this day.
It wasn't until 1963 that ChapStick was purchased by A.H. Robbins Pharmaceuticals. This new owner brought the brand's manufacturing to Virginia and took the brand international.In 1972, ChapStick was launched in the U.K. The ChapStick brand changed hands a few more times in between before being acquired by Glaxosmithkine in 2019.
Today, this iconic little black tube has over 100 years of history as one of America's preferred lip skincare products. Over the years, ChapStick has also continued to cater to consumer demand and develop a diverse range of products, having launched a co-branded lip balm product with hip brand Supreme in 2022. According to Haleon, ChapStick generated £112 million ($1.022 billion) in revenue in 2023.
Haleon CEO Brian McNamara explained the decision to sell in a statement, "While ChapStick is a great brand, beloved by consumers around the world, it is not a core focus for Haleon. Selling the brand allows us to streamline our business and pay down debt faster. We are confident that the brand will continue to thrive under its new owners."
And acquirer Yellow Wood Partners is adding ChapStick to its growing portfolio of consumer brands.Yellow Wood's diverse portfolio of consumer brands also includes Dr. Scholl's, Real Techniques, Byoma and sunscreen brands lsle of Paradise, Tanologist, and TanLuxe.
In December 2023, Yellow Wood Partner acquired Elida beauty, a portfolio of brands owned by Unilever, which generated turnover of around €800 million (Rs. 6,213 million) in 2022, including household brands Q-tips, Caress, Timotei and Tigi. ChapStick will be assigned to Yellow Wood's Suave Brands.
Suave Brands Company was established by Yellow Wood Funds in May 2023, originally to acquire the Suave brand from Unilever.Daniel Alter, CEO of Suave Brands, stated, "Yellow Wood acquired the Suave Brands to create Suave Brands. We saw the opportunity to grow Suave through a more centralized management approach, while also creating the corporate infrastructure to acquire and manage more personal care brands across multiple categories to drive synergies across the platform." And he emphasized that Yellow Wood's acquisition pace is not over. "We look forward to continuing to grow our portfolio by acquiring additional personal care brands."
Tad Yanagi, Partner at Yellow Wood Partners, said, "ChapStick will be Yellow Wood's fifth corporate divestiture transaction in the last four years. The firm is proud to be a trusted transaction partner in helping them develop their brand and prepare for the next phase of growth."
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