Vestar Capital Partners has purchased consumer goods conglomerate Unilever’s North American detergent unit for more than $1.4 billion (€889 million) in cash and stock.
The deal, expected to close sometime in the next two months, will grant Vestar ownership of several well known North American brands, including Snuggle, Wisk and Surf, as well as Unilever’s detergent manufacturing facility in Baltimore, Maryland.
New York-based Vestar plans to merge the unit with portfolio company Huish Detergents to form The Sun Products, a newly consolidated laundry products business. Vestar has tapped Huish director Neil DeFeo as chief executive of the new company.
Under terms of the deal, Unilever will receive $1.1 billion in cash as well as $375 million in preferred shares in Sun Products. The Netherlands-based conglomerate will also receive warrants with an option to acquire up to 2.5 percent of common equity in the combined business.
Vestar purchased Huish in April of last year for an undisclosed amount. In addition to brand name detergents like Sun and Ultra, Huish produces fabric softeners, dish care and personal care products.
Vestar is currently investing its $3.65 billion fifth fund, closed in 2005. Past Vestar investments in well-known consumer brands include razor maker Remington and sock maker Gold Toe.
The firm typically invests in companies ranging from $250 million to $3 billion in value, with the ability to invest up to $700 million in a single transaction.
The divestiture is part of Unilever’s publicly announced plans to sell any non-strategic brands with more than €2 billion in turnover.