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Yellow Wood inks $510M deal for ChapStick brand

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Jan 25, 2024
A tube of chapstick

Photo: Daniel Acker/Bloomberg via Getty Images

Yellow Wood Partners agreed to acquire the ChapStick brand from consumer health company Haleon for about $510 million.

Driving the news: The Boston-based firm is on a streak of acquisitions, scooping up Suave Brands from Unilever last May and Elida Beauty last month.

Details: The transaction figure includes around $430 million in cash and an $80 million passive minority stake in Yellow Wood's Suave.

  • ChapStick garnered around 112 million in revenue for the fiscal year ended Dec. 31, 2023.
  • Suave will absorb ChapStick under its personal care brands.

Catch up quick: Haleon was initially hoping for about $600 million for the business.

What they're saying: "We saw the opportunity to grow Suave with a more focused management approach while also creating the corporate infrastructure to acquire and manage additional personal care brands across multiple categories to drive synergies across the platform," Suave CEO Daniel Alter said in a release.

Meanwhile, "selling [ChapStick] allows us to simplify our business and pay down debt more quickly," Haleon CEO Brian McNamara said in a statement.

Context: This will be Yellow's fifth corporate carveout transaction in the past four years.

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