Yellow Wood Partners, a Boston-based private equity firm recognized for its strategic investments in consumer brands, has announced a significant development in the personal care industry. Its portfolio company, Suave Brands Company, has officially signed a binding offer to acquire the esteemed ChapStick brand from the global consumer health leader, Haleon (LSE/NYSE: HLN). With a transaction value placed at the forefront of the announcement, the deal is slated for completion in the first half of 2024, pending customary closing and regulatory approvals.

ChapStick, a pioneer in the lip care category since the 1880s, has cemented its status as a household name. Leading the market in innovation with its extensive product range that includes new ingredients, skincare benefits, and flavors, ChapStick enjoys unparalleled brand awareness and is the number one brand by volume in its category.

Suave Brands Company, under the leadership of CEO Daniel Alter, has been on a strategic path since its formation in May 2023 following the acquisition of the Suave brand from Unilever. The company is focused on acquiring and managing additional personal care brands to create a robust platform of category-leading products. “We are excited to add ChapStick, another leading brand with deep equity and history, into our platform,” Alter remarked, highlighting the strategic vision of expanding Suave Brands Company’s portfolio through synergistic acquisitions.

Suave, a value-oriented brand known for its salon-quality hair care products accessible to the general public, has a significant presence in U.S. households, selling across various segments including hair, body, skin, and antiperspirant deodorants. This acquisition is expected to leverage Suave’s existing infrastructure and expertise to foster growth and innovation within ChapStick.

Dana Schmaltz, Partner at Yellow Wood Partners, echoed the sentiment of strategic growth, noting ChapStick’s strong market position and consumer appeal. The acquisition aligns with Yellow Wood’s investment philosophy of nurturing brands to achieve their growth potential through increased marketing investments and a focused sales approach.

Tad Yanagi, also a Partner at Yellow Wood, emphasized the firm’s expertise in executing corporate carveout transactions, marking ChapStick as the fifth such transaction in four years. The acquisition demonstrates Yellow Wood’s commitment to partnering with consumer packaged goods companies to facilitate brand growth and development.

Yellow Wood Partners’ diverse portfolio includes notable brands such as Dr. Scholl’s, Beacon Wellness Brands, and the Elida Beauty portfolio, further underscoring its leadership in the consumer brands space. The acquisition of ChapStick by Suave Brands Company from Haleon represents a strategic expansion that promises to enhance the consumer brand landscape, driving forward the mission of delivering beloved products to global consumers.

This acquisition not only signifies a pivotal moment for Suave Brands Company and ChapStick but also highlights the dynamic nature of the personal care industry, where innovation, consumer preference, and strategic investment converge to shape the future of global consumer brands.

The acquisition of ChapStick by Suave Brands Company is a strategic move that leverages Yellow Wood Partners’ expertise in nurturing and growing consumer brands. By integrating ChapStick into its portfolio, Suave Brands Company is poised to enhance its market presence and drive synergies across its product lines. This transaction underscores the importance of strategic brand management and investment in the consumer goods sector, promising to deliver significant value to consumers and stakeholders alike.

  ChapStick, Dana Schmaltz, Haleon, Suave Brands, Tad Yanagi, Yellow Wood Partners