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1 Fung Business Intelligence Centre Global Retail & Technology Flash Report: Unilever Acauires Murad SkinCare Copyright © 2015 The Fung Group. All rights reserved.
jiuly 6, 2015
Unilever Acquires Murad Skincare
On July 2, Unilever announced an agreement to acquire clinical skincare brand Murad for an undisclosed figure. Murad’s products include cleansers, treatments, moisturizers, eye-‐care products, bodycare products, regimens, masks, suncare products, supplements and toners. The Murad brand had total revenues of US$115 million in 2014, and its products are sold across the US in professional salons and spas, at retailers such as Sephora, Ulta and Nordstrom, and through direct sales. The transaction is subject to customary approvals.
The acquisition follows three recent acquisitions of premium skincare brands— Dermalogica (announced June 24), Kate Somerville Skincare (announced May 6) and REN Skincare (announced March 2)—which follow several other prior skincare acquisitions. Murad will be integrated into Unilever’s Prestige division, which distributes select premium personal care brands. Dermalogica disclosed revenues of US$240 million in 2014, and REN Skincare had revenues of US$62.6 million in 2013, according to Forbes. Hoover’s put Kate Somerville’s annual sales at US$9.9 million. That means the combined annual revenue from the four acquisitions (including Murad) is nearly US$428 million, or roughly 3% of Unilever’s total 2014 Personal Care revenue of US$13.9 billion (€12.4 billion).
Murad was founded in 1989 in Los Angeles by Howard Murad, MD, a board-‐certified dermatologist, trained pharmacist and Associate Clinical Professor of Medicine at the Geffen School of Medicine at UCLA. Dr. Murad has treated more than 50,000 patients, and he founded Murad as a way to share his skincare formulas, which demonstrated significant, measurable antiaging results. He continues to research skincare and holds 19 patents. Dr. Murad is known as “The Father of Internal Skincare” for being an early proponent of dietary supplements to promote skin health and as a pioneer of the use of alpha hydroxy acids in topical skincare.
2 Fung Business Intelligence Centre Global Retail & Technology Flash Report: Unilever Acauires Murad SkinCare Copyright © 2015 The Fung Group. All rights reserved.
The Murad acquisition is part of Unilever’s public strategy to make sustainable living commonplace, while at the same time doubling the size of its business, reducing its environmental footprint and increasing its positive social impact. Unilever’s recent acquisitions are detailed in the table at the end of this report.
Unilever appears to be emphasizing its Personal Care business and de-‐emphasizing its Food business through selective acquisitions and divestitures, except for ice cream, a category in which the company has made several acquisitions. The Food segment accounted for just 26% of total 2014 revenues, as compared to 35% in 2008, whereas the Personal Care segment grew to 37% of total revenues in 2014, up from 28% in 2008.
SELECTED RECENT UNILEVER ACQUISITIONS Date Announced
Acquisition
Business
Value (USD Mil.)
07/02/2015 Murad Skincare products Undiscl.
06/24/2015 Dermalogica Skincare products Undiscl.
05/06/2015 Kate Somerville Skincare Skincare products Undiscl.
03/13/2015 Bhavishya Alliance Child Nutrition Initiatives
Partnership for child nutrition Undiscl.
03/02/2015 REN Skincare Skincare products Undiscl.
12/22/2014 Camay and Zest brands Skincare products Undiscl.
12/02/2014 Talenti Gelato e Sorbetto Ice cream Undiscl.
09/06/2013 T2 Premium Australian tea business Undiscl.
03/07/2014 55% equity stake in Qinyuan Group Chinese water purification business Undiscl.
04/30/2013 Increase in ownership of Hindustan Unilever to 67% from 52% Consumer goods 3,190
04/08/2013 SAVO and other consumer brands Household cleaning products and disinfectants Undiscl.
11/28/2012 Unilever Pakistan Home, personal care, foods 505
12/21/2011 Remaining 18% of Concern Kalina Russian personal care products 130
12/20/2011 Ingman Ice Cream Ice cream Undiscl.
10/14/2011 82% stake in Concern Kalina Russian personal care products 673
05/10/2011 Alberto Culver Hair and skincare 3,861
03/23/2011 Colombian Laundry business Laundry 215
09/28/2010 EVGA’s brands and distribution network Greek ice cream Undiscl.
04/29/2010 Glidat Strauss Israel Ice cream Undiscl.
09/25/2009 Sara Lee’s personal care business Skin cleansing and deodorants 1,813
Source: S&P Capital IQ and company reports
3 Fung Business Intelligence Centre Global Retail & Technology Flash Report: Unilever Acauires Murad SkinCare Copyright © 2015 The Fung Group. All rights reserved.
Deborah Weinswig, CPA Executive Director—Head of Global Retail & Technology Fung Business Intelligence Centre New York: 917.655.6790 Hong Kong: +852 6119 1779 deborahweinswig@fung1937.com
Cam Bolden cambolden@fung1937.com Sunny Chan, CFA sunnychan@fung1937.com Tal Dor taldor@fung1937.com Marie Driscoll, CFA mariedriscoll@fung1937.com John Harmon, CFA johnharmon@fung1937.com Aragorn Ho aragornho@fung1937.com John Mercer johnmercer@fung1937.com Swarooprani Muralidhar swaroopmuralidhar@fung1937.com Charlie Poon charliepoon@fung1937.com Kiril Popov kirilpopov@fung1937.com Stephanie Reilly stephaniereilly@fung1937.com Lan Rosengard lanrosengard@fung1937.com Jing Wang jingwang@fung1937.com
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