Colgate Purchasing Tom's of Maine; Enters Fast-Growing Natural Products Segment
March 21 2006 - 8:30AM
PR Newswire (US)
NEW YORK, March 21, 2006 /PRNewswire-FirstCall/ --
Colgate-Palmolive Company (NYSE:CL), as part of its strategy to
focus on its higher-margin oral and personal care businesses, today
announced that it has agreed to purchase Tom's of Maine, the leader
in the fast-growing Naturals market in the United States. The U.S.
market for Natural oral and personal care products is valued at $3
billion and is growing at 15 percent per year. Tom's of Maine,
founded in 1970 by Tom and Kate Chappell, pioneered natural
toothpaste, mouthwash, and deodorant, and is the #1 Oral Care Brand
in the Natural category. Tom's of Maine gives Colgate the
opportunity to enter the fast growing health and specialty trade
channel where Tom's toothpaste is the clear market leader
commanding 60% share of that channel. Reuben Mark, Colgate's
Chairman and CEO said, "We have great admiration for Tom and Kate
Chappell and the values-based business they have created. The
combination of Colgate, the global leader in Oral care, and Tom's
of Maine, the leader in the Naturals category, is an exciting
partnership with growth opportunities for both companies. And we're
especially pleased that Tom Chappell will remain on to lead the
company, which will continue to be based in Kennebunk, Maine." Ian
Cook, Colgate's President and COO, said, "This acquisition allows
Colgate to strongly enter a completely new channel of distribution
and establishes us as the only global oral care company in that
channel. This bodes well for additional opportunities in other high
margin categories such as personal care. Further, our truly global
reach will help speed the growth of the naturals health and
specialty business outside the U.S. With gross profit margins a
full ten percentage points higher than Colgate's margin, Tom's of
Maine is a logical acquisition as we continue to prioritize our
global oral and personal care categories." Tom's of Maine
co-founders Tom and Kate Chappell said, "We chose Colgate as our
partner because they have the global expertise to help take Tom's
of Maine to the next level. Just as importantly, we see Colgate as
an excellent fit with our own cultural values. Colgate has a
commitment to product excellence, to global efforts to promote oral
health and has a 200-year history of caring for consumers and for
giving back to the community. We are excited by Colgate's desire to
continue Tom's of Maine leadership and heritage in natural care."
The transaction will be structured as an all cash acquisition of 84
percent of the outstanding shares of Tom's of Maine for an
aggregate price of approximately $100 million, subject to
adjustment at closing, which is expected in the second quarter of
this year. The effect on Colgate's profits is expected to be
neutral in 2006 and increasingly positive each year thereafter. The
Chappell family will retain a 16 percent ownership interest, with
additional share purchase opportunities for Colgate over the coming
years. The purchase is subject to regulatory approval and other
closing conditions. * * * About Colgate-Palmolive:
Colgate-Palmolive is a leading global consumer products company,
tightly focused on Oral Care, Personal Care, Home Care and Pet
Nutrition. Colgate sells its products in over 200 countries and
territories around the world under such internationally recognized
brand names as Colgate, Palmolive, Mennen, Softsoap, Irish Spring,
Protex, Sorriso, Kolynos, Elmex, Ajax, Axion, Soupline, and
Suavitel, as well as Hill's Science Diet and Hill's Prescription
Diet pet foods. For more information about Colgate's global
business, visit the Company's web site at http://www.colgate.com/.
About Tom's of Maine: Tom's of Maine creates effective personal
care products using simple, natural ingredients derived from plants
and minerals. Tom's of Maine products-toothpaste, mouthwash, floss,
deodorant, and soap-do not contain artificial sweeteners,
preservatives, colors, flavors, or animal ingredients; are tested
for safety and efficacy without the use of animals; are
biodegradable; and are packaged in earth-friendly ways. Guided by a
philosophy of "Natural Care" they donate 10% of profits to
charitable organizations; encourage employees to use 5% of their
paid time in volunteer work; adhere to standards of natural,
sustainable, and responsible; and do not test on animals. Visit
http://www.tomsofmaine.com/ for more information. This press
release (other than historical information) may contain
forward-looking statements. Actual events or results may differ
materially from those statements. Investors should consult the
Company's filings with the Securities and Exchange Commission
(including the information set forth under the captions "Risk
Factors" and "Cautionary Statement on Forward-Looking Statements"
in the Company's Form 10-K for the year ended December 31, 2005)
for information about factors that could cause such differences.
Copies of these filings may be obtained upon request from the
Company's Investor Relations Department or the Company's web site
at http://www.colgate.com/. DATASOURCE: Colgate-Palmolive Company
CONTACT: Bina Thompson, +1-212-310-3072, or Allison Klimerman,
+1-212-310-3770 Web site: http://www.colgate.com/
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