Unilever seems to have shown uncharacteristic candor and courage in assessing its market position in the US in laundry products, and ceding the market to Proctor & Gamble.
What puzzles me is why Vestar Capital Partners bought the businesses at any price.
The Wall Street Journal article in yesterday's edition was silent on what the acquirer intends to do with the brands. Other than forming 'Sun Products Corporation,' there was no information about Vestar or its plans.
If an experienced, global competitor to P&G couldn't make these businesses go, how would a smaller private equity shop do so? Was management at Unilever's American operations so bad that it couldn't make decent brands prosper? Or were the overhead charges and associated red tape of being part of the global giant too much burden for some decent businesses to offset?
Reading the brands involved- All, Snuggle, and Surf, to name a few- I have to say that I haven't seen advertising for any of them in years. They seem to be truly aged brands.
I guess I would have expected Unilever to just fold up those businesses. Finding a buyer for them, at about $1.4B, no less, seems an incredible stroke of good fortune for the European consumer products giant.
I'm really quite curious as to what will become of the brands involved, who Vestar is, and why they saw so much value in the moribund Unilever operations being shuttered/divested.
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