In a sign that Colgate-Palmolive is looking to diversify its interests beyond soap and toothpaste with deals, the consumer goods group has come to an agreement to purchase the Filorga Cosmétiques skincare business for €1.5 billion. Colgate is said to fund the transaction, which is subject to regulatory approval, via cash and debt, FT reported.
Paris-based Filorga is a brand for anti-aging skincare mostly focused on facial care. It is sold in over 60 nations with continental Europe its base, and was started in 1978 in France. The brand is said to join a bevy of company brands such as Speed Stick, Softsoap and Ajax cleaner in addition to oral care products.
The acquisition is newsworthy as the company had been reserved in the area of acquisitions and mergers with Ian Cook, a longtime chief executive. Noel Wallace, however, replaced Cook in April, taking charge of a group with $15.5 billion in annual sales and $63.4 billion market capitalization.
Wells Fargo Analyst Bonnie Herzog said, according to the report, that the arrangement was “a clear sign that Wallace will be more aggressive with M&A to reshape the portfolio outside of oral care, a big change for a company that has historically been run very conservatively.”
In a statement reported by the outlet, Wallace said that Filorga would provide Colgate with “entry into the fast-growing and sizeable travel retail channel, particularly in Asia.” He also noted that “this acquisition will add a high-growth, profitable, global skincare asset to the Colgate portfolio.”
As of last year, health and wellness was a $4.2 trillion annual industry, having grown 12.8 percent between 2015 and 2017 per the Global Wellness Institute. The industry now represents 5.3 percent of global economic output.
Global Wellness Institute Senior Research Fellow Ophelia Yeung said per previous reports, “As people incorporate more of the wellness values into their lifestyle, our interaction with the wellness economy is also becoming less episodic and more intentional, more integrative, and more holistic.”