Target: Frederic Fekkai & Co.
Buyer: Procter & Gamble
Seller: Catterton Partners
Financial Adviser: Seller: Goldman Sachs
Legal Counsel: Seller: Gibson Dunn & Crutcher LLP
Consumer products giant Procter & Gamble picked up the business for more than $400 million, equivalent to 4x the company’s annual revenue, according to a source familiar with the deal. Catterton Partners in 2005 paid less than $100 million for Frederic Fekkai.
The company operated under the LBO firm’s health and beauty product management company, called Chrysallis. Catterton Partners established Chrysallis, in part, to spread the management talent of CEO Melisse Shaban across all of its health and beauty-related portfolio companies. After the sale of Frederic Fekkai, the remaining Chrysalis businesses include topical ointment maker Niadyne and British cosmetics brand Pout. The firm declined to comment because the deal hasn’t yet closed.
The price paid for Frederic Fekkai surpassed that of other LBO-backed personal-care product companies. In 2007
“It’s showing that valuations for luxury personal care brands with growth left are still selling at luxury kinds of multiples,” said Joyce Greenburg, a managing director with boutique investment bank Financo. “Strategic buyers are still willing to pay if the growth is extendable.”
The attraction for Procter & Gamble lies in Frederic Fekkai’s ability to enter new product categories. The company makes shampoo and styling products, but has the potential to become a lifestyle brand, with new offerings in hair color and skin care, Greenburg said. For P&G, the deal is part of a strategic effort to increase its presence in high end personal-care products. Last year it bought HDS Cosmetics Labs, the maker of DDF Skin Care, from mid-market health-focused LBO shop
Catterton Partners paid for Frederic Fekkai out of