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PDC Brands exploring a USD 1bn sale: WSJ
Posted on Thursday, 20 April 2017 13:42
PDC Brands, a beauty and personal care business, is said to be working with investment banks on a potential divestment that could value the company at around USD 1.00 billion.
The Wall Street Journal (WSJ) cited people close to the matter as saying the group is hoping to fetch a mid-teens multiple of earnings before interest, taxes, depreciation and amortisation (EBITDA) or higher.
Jefferies and William Blair are reportedly working on a sale process for the Connecticut-based beauty products firm, which is currently backed by Yellow Wood Partners.
According to industry insiders cited by WSJ, private equity investors have historically been drawn to the strong margins and fragmented nature of the beauty sector, with larger strategic players also being active acquirors of late.
PDC Brands claims to be one of the fast growing businesses in the industry globally with a portfolio of cosmetics, hair, fragrance and wellness brands across 60 countries worldwide.
Some of the group’s best sellers include DrTeal’s, Eylure and cantu.
PDC Brands was established in 1981 under the same Parfums de Coeur and was picked up by Yellow Wood for an undisclosed amount in 2012.
According to the sources, the company is expected to generate EBITDA of between USD 100.00 million and USD 110.00 million in 2017.
Since coming under the ownership of Yellow Wood, PDC Brands has significantly expanded its portfolio outside of its initial fragrance operations, with its latest purchase in 2015 comprising Advanced Beauty’s bodycology and cantu brands for an undisclosed amount.
A number of large deals have taken place in the beauty industry in the last 12 months, including Estee Lauder buying Too Faced Cosmetics for USD 1.45 billion in December and the USD 1.20 billion L’Oreal paid for IT Cosmetics in August 2016.
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