Schick par­ent to ac­quire Harry’s

The News-Times - - BUSINESS - By Jor­dan Grice

Edgewell Per­sonal Care Co., which owns Schick and Wilkin­son Sword ra­zor brands, is adding Harry’s Inc. to its list of sub­sidiaries.

The Mis­souri-based com­pany, which also has head­quar­ters in Shel­ton, an­nounced Thurs­day that it is pre­par­ing to buy the New York-based startup in a $1.37 bil­lion cash-and-stock deal.

“With ev­ery­thing, the tim­ing has to be right, and in this case, the tim­ing is right for this com­bi­na­tion,” said Edgewell Pres­i­dent and CEO Rod Lit­tle, dur­ing a Thurs­day earn­ings call.

The com­pany will pay roughly 79 per­cent of the to­tal value of the trans­ac­tion in cash, while the re­main­ing fi­nanc­ing will be paid in com­mon stocks.

Harry’s share­hold­ers will own ap­prox­i­mately 11 per­cent of Edgewell once the trans­ac­tion is com­plete.

Gold­man Sachs and Perella Wein­berg Part­ners are fi­nan­cial ad­vis­ers to Edgewell, while Wachtell, Lip­ton, Rosen and Katz served as the com­pany’s le­gal ad­viser.

Cen­ter­view Part­ners was the fi­nan­cial ad­viser to Harry’s and Latham and Watkins and O’Mel­veny and My­ers served as its le­gal ad­vis­ers

The ac­qui­si­tion is ex­pected to close in the first quar­ter of 2020.

Dur­ing a Thurs­day morning con­fer­ence call, Lit­tle ac­knowl­edged that a dis­con­nect with con­sumers over the years has slowed sales.

“Consumer needs, habits, ways of shop­ping have changed dra­mat­i­cally over the last decade,” he said. “Brands need to be consumer-cen­tric, con­nect with con­sumers and sat­isfy their chang­ing needs and habits and also pro­vide a great ex­pe­ri­ence wher­ever and when­ever the consumer is ready to en­gage.”

Edgewell wants to fix that, in part, with ac­qui­si­tions of com­pa­nies like Harry’s, the com­pany said.

The New York startup fo­cused on a di­rect-to-consumer on­line plat­form that sold ra­zors and shav­ing creams through a monthly sub­scrip­tion ser­vice.

“When we launched Harry’s six years ago, our

vi­sion was to cre­ate a groom­ing brand that bet­ter met our needs as con­sumers, and over time, a (consumer pack­aged prod­uct) plat­form that cre­ates brands peo­ple love across more cat­e­gories,” said Harry’s Co-founders and CEOs Andy Katz-May­field and Jeff Raider

in a state­ment.

Since its 2013 launch, Harry’s has branched into dif­fer­ent per­sonal care prod­uct lines and ex­panded. It owns and op­er­ates its own ra­zor fac­tory in Eis­feld, Ger­many, and em­ploys more than 900 peo­ple across the globe.

Edgewell op­er­ates in more than 50 mar­kets glob­ally and em­ploys roughly 6,000 peo­ple.

While it was not made clear

how the ac­qui­si­tion would af­fect Harry’s em­ploy­ees, the Shel­ton com­pany said it plans to lever­age the startup’s back­ground in di­rect-to-consumer sales and brand mar­ket­ing to im­prove Edgewell’s per­for­mance with cus­tomers.

Katz-May­field and Raider are ex­pected to join Edgewell’s ex­ec­u­tive team when the deal closes next year, serv­ing as co-pres­i­dents of U.S. oper­a­tions.

Lit­tle will lead the com­bined com­pany.

“The com­bi­na­tion of Edgewell and Harry’s is a piv­otal step for­ward in fur­ther trans­form­ing our or­ga­ni­za­tion and strength­en­ing our com­pet­i­tive po­si­tion and abil­ity to drive sus­tained growth and value cre­ation,” Lit­tle said in a press re­lease.

As­so­ci­ated Press

The Win­ston ra­zor and Harry’s face lo­tion on dis­play at the head­quar­ters of Harry’s Inc. in New York.

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