Unilever aiming to grow haircare range with £2.3bn deal

UNILEVER, the consumer goods giant behind the Dove and Vaseline brands, yesterday announced plans to add VO5 shampoo and TRESemme to its bulging portfolio as part of a £2.3 billion deal.

The proposed acquisition of US-based Alberto Culver would make Unilever the world's leading company in hair conditioning and second largest in shampoo.

Unilever chief executive Paul Polman said the deal - the second major transaction since he took on the role last year - would add some "powerful" new brands to the company's portfolio.

The firm's food brands include Knorr, Hellmann's and Flora, while last September it added bath products Sanex and Radox following a deal worth 1.15bn with US-based firm Sara Lee. Polman said the personal care category represented 20 per cent of Unilever's turnover ten years ago, but had grown to reach more than 30 per cent with strong positions in many emerging markets.

"Bolt-on acquisitions such as Alberto Culver supplement organic growth and add powerful new brands to our portfolio," he added.

The Alberto Culver business began life as a one-product company in 1955 and its founder Leonard Lavin continues to be a director, while his family are also key shareholders.

The business, which has operations in nine countries and employs about 2,700 people, generated sales of 1bn in the year to the end of June. The acquisition is subject to regulatory approval and the backing of Alberto Culver shareholders.

Analyst James Edwardes Jones at Execution Noble estimated cost savings from the deal could be around 128 million, making it a sensible one "both financially and also strategically". Unilever shares closed up 23p at 1,816p.