German Conglomerate Henkel to Acquire Olaplex in $1.4 Billion Deal

Deep News03-26 22:03

German consumer goods group Henkel announced on Thursday that it has agreed to acquire all outstanding shares of premium hair care brand Olaplex for $1.4 billion.

Henkel stated that the transaction, priced at $2.06 per share, has received unanimous approval from Olaplex's board of directors and represents a "significant milestone" in Henkel's business strategy.

Henkel CEO Carsten Knobel said in a statement, "The proposed acquisition of Olaplex fully aligns with Henkel's strategy to expand its portfolio through attractive, value-creating mergers and acquisitions. This transaction enables us to broaden our footprint in the premium hair care segment. The brand offers highly attractive opportunities for future growth and innovation."

Henkel's portfolio includes brands such as Got2b and Purex.

Olaplex indicated that the deal, which represents a premium of over 50% to its Wednesday closing price, will allow the company to explore new innovation and growth opportunities and expand its international operations.

Olaplex CEO Amanda Baldwin stated, "This step is a testament to the progress we have made in our transformation and the significant opportunity that lies ahead for Olaplex to continue shaping the future of hair health and achieve long-term growth."

The company's shares closed at approximately $1.30 per share on Wednesday. Following the announcement, its stock surged 50% in pre-market trading.

In recent years, Olaplex has faced challenges as a public company, contending with negative publicity from a lawsuit alleging its products caused hair loss, as well as increased competition in the premium hair care segment.

Prior to this transaction, Olaplex's stock had declined nearly 95% since its initial public offering in 2021. The company debuted at $25 per share during a peak period for IPOs. Olaplex has been working to turn its business around, including launching a new product last month and focusing on rebuilding its reputation among consumers.

Analysts had previously expressed optimism about the prospect of the company potentially going private.

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