Unilever ups stakes against P&G and L’Oreal with $3.7bn Alberto Culver deal

Unilever has announced its intention to go all out for leadership in the booming personal care sector with a $3.7bn bid for Alberto VO5 and TRESemme maker Alberto Culver. The high cash bid, Alberto Culver’s revenues are only $1.6bn, signals clearly that Unilever wants to be top in the sector and follows last year’s acquisition of Sara Lee’s personal care division that includes Radox and Brylcreem.

The EU competition authorities are still examining the latter deal. This latest move may indicate that Unilever would sooner have Alberto Culver than Sara Lee.

Unilever CEO Paul Polman says personal care is growing rapidly and currently accounts for 30 per cent of Unilever’s sales against 20 per cent a decade ago. As usual emerging markets are to blame, Unilever is clearly banking on selling more high margin haircare and related products to Indians, Chinese and others in the Far East.

Procter & Gamble, which greatly boosted its personal care interests a few years ago with the purchase of Wella, and French giant L’Oreal may still try to intervene but Unilever is paying what it clearly believes is a knockout bid price.

On the agency front Alberto’s creative business is split between Havas and Interpublic group agencies, who’ll be feeling nervous as Unilever’s WPP agencies and Publicis Groupe’s BBH (a Unilever favourite thanks to its work on Lynx) circle.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.