Helen of Troy has announced its acquisition of Olive & June, a popular nail care brand, for a total purchase price of $240 million, including a $15 million earnout. This strategic move aims to bolster Helen of Troy's portfolio beyond hair care and to capitalize on the growing demand for at-home nail care solutions, per the brand. The acquisition is expected to close before calendar year end 2024, subject to customary closing conditions, including regulatory approvals.
Helen of Troy plans to employ a “stand-alone but supported” operating model that retains Olive & June’s management team, including founder and CEO, Sarah Gibson Tuttle, and leverages Helen of Troy’s capabilities and scale to further accelerate Olive & June’s growth.
The total purchase is expected to be $225 million in cash at closing, subject to certain closing adjustments, and a $15 million earnout subject to performance over three years.
The acquisition is projected to increase revenue, profit margins, and earnings per share. Additionally, the company has taken steps to manage its debt and interest rate exposure through interest rate swaps.
- Interest Rate Swaps: Helen of Troy secured interest rate swaps on an additional $250 million of variable-rate debt in September 2024.
- Fixed Interest Rate: This move locks in a fixed interest rate of 3.7% for an average of 18 months, providing protection against potential interest rate increases.
- Debt Composition: As of November 20, 2024, approximately 71% of Helen of Troy's total debt is fixed at an average interest rate of 3.9% through February 2026.
Noel M. Geoffroy, Helen of Troy chief executive officer, stated: “We could not be more excited to add Olive & June to our portfolio of leading brands and we welcome its passionate associates and visionary leadership team to the Helen of Troy family. We believe Olive & June is an excellent fit with Helen of Troy both strategically and financially. Olive & June’s innovation-driven performance, highly relevant vision of democratizing nail care for everyone, award-winning products and unique consumer engagement model are impressive and inspiring.”
Geoffroy adds, “We see significant opportunities to build on its strengths in consumer obsession and breakthrough commercial and product innovation, in addition to helping expand the brand’s availability with increased distribution. Olive & June complements our existing Beauty portfolio and broadens us beyond the hair category, adding a consumables business that is both high growth and high margin. We look forward to working together to fully realize the potential of Olive & June.”
Sarah Gibson Tuttle, founder and CEO of Olive & June, said: “When I started Olive & June, the mission was simple: to make salon-quality nails accessible to everyone, everywhere. Thanks to our passionate team and loyal community, we have achieved incredible milestones—teaching millions how to do their nails at home and redefining what is possible in Beauty. Now, as we join the Helen of Troy family, a company known for elevating everyday experiences with innovative consumer products, I could not be more thrilled to lead this next chapter of growth for the brand. I have been deeply impressed by Noel’s visionary leadership and look forward to partnering with her and the entire Helen of Troy team. Together, we will continue to innovate, inspire, and deliver on our promise to be the go-to at-home nail solution for everyone, everywhere. I cannot wait to see all that we will accomplish together.”
Conference Call and Webcast
Helen of Troy will conduct a teleconference November 22, 2024. A replay of the webcast will remain available on the website for one year.
