UPDATED: Will Unilever buy e-commerce startup The Honest Company?
After buying the razor delivery subscription service Dollar Shave Club in July for $1 billion, consumer goods giant Unilever is said to be in talks to acquire e-commerce startup The Honest Company, according to The Wall Street Journal.
Founded by actress Jessica Alba, The Honest Company sells baby products, household cleaning products and personal-care and beauty products that are non-toxic. Alba started the company in 2011 because of the lack of baby products on the market that were free from petrochemicals and synthetic fragrances.
The Honest Company sells some of its range in retail outlets, including Target and Whole Foods Markets in the US, but many customers buy directly from the company’s website through a monthly subscription service. A fundraising round last year valued the company at $1.7 billion, though sources say the Unilever deal would be closer to $1 billion.
The deal is far from a sure thing, with the possibility of an initial public offering still on the table. If it goes ahead, however, it will be the latest in a string of major e-commerce acquisitions this year. Besides Unilever’s purchase of Dollar Shave Club, Walmart also bought Jet.com for $3.3 billion. This trend is due to a cooling IPO market and investors’ insistence that start-ups become profitable, according to The Wall Street Journal article.
UPDATE: Unilever announces acquisition of Seventh Generation (20/9, 2:30pm)
Unilever has agreed to acquire Seventh Generation, an eco-friendly cleaning-products company based in Vermont, US. Terms of the deal were not disclosed. Seventh Generation’s turnover exceeded US$200 million in 2015 and the company has seen double digit compound annual growth over the last 10 years.
Just days ago Unilever was rumoured to be in talks to buy The Honest Company for US$1 billion. The Honest Company also sells natural products, though it focuses on baby and personal-care products rather than cleaning products.
Speaking to Bloomberg, Ali Dibadj, an analyst at Sanford C. Bernstein, said the Seventh Generation deal raises questions about whether Unilever will acquire The Honest Company after all.