Knowlton Development Corp (KDC), which earlier this year bought ChemAid and Kolmar, has acquired Cosmetic Technologies Inc, a U.S.-based maker of cosmetics and personal care products. The deal, the value of which was not disclosed, is being funded by Canadian private equity firm Novacap in partnership with the Caisse de dépôt et placement du Québec, Fonds de solidarité FTQ, Investissement Québec, Export Development Canada, Fondaction CSN and other investors. Longueuil, Québec-based KDC said its latest buy will increase capacity for personal care products manufacturing on the West Coast and allow it to serve local clients. Recapitalized last year, the company plans to double production by 2018.
KDC continues its string of acquisitions by purchasing Cosmetic Technologies
Montréal, October 21, 2015 – KDC (Knowlton Development Corporation), a leading contract manufacturer of health and beauty-care products headquartered in Longueuil, Québec, today announced the acquisition of Cosmetic Technologies, a California-based cosmetics and personal care products contract manufacturer providing turnkey solutions from initial product concept, to formulation, manufacturing, packaging, and warehousing.
This transaction follows the acquisition last week of Kolmar, a New-York-based custom formulator and manufacturer of color cosmetics, personal care and skincare products and, ten months ago, of ChemAid, an innovative formulator and manufacturer of skincare, hair care and bath and body products based in New-Jersey. The transaction is being financed by KDC’s parent company NOVACAP, through its NOVACAP Industries IV fund, in partnership with La Caisse de dépôt et placement du Québec, the Fonds de solidarité FTQ, Investissement-Québec, Export Development Canada (EDC), Fondaction CSN and other institutional partners.
The acquisition marks yet another step forward in KDC’s evolution as world-class leader in the supply of high quality, innovative products and delivery solutions to prominent brands, as it extends its manufacturing capabilities into the West Coast.
“California is well known for its innovative products and its upscale, independent brands,” said Nicholas Whitley, President and CEO of KDC. “With the acquisition of Cosmetic Technologies, we are able to expand our manufacturing capabilities to the West Coast and serve our clients there on a local basis, which is what they want. Furthermore, it allows us to manufacture smaller orders, starting at 5,000 units, for high-end products, while using our network of facilities to help these niche and independent West Coast brands grow into larger markets. We were particularly impressed with Cosmetic Technologies’ highly-skilled management team and their deep industry experience and relationships, including an R&D staff with top chemical engineering talent.”
“Cosmetic Technologies is a relatively smaller acquisition than Kolmar, but it is nonetheless very strategic for KDC,” added Michel Coté, KDC’s Chairman and Senior Partner at NOVACAP. “It has an impressive track record of financial performance in recent years and is well positioned for continued long-term future growth. It also allows us to widen our manufacturing and servicing capabilities, and will contribute in the mid to long term to the success of all our clients, and to our positioning as an industry leader all over North America.”
“The growing demand for our products has the potential to more than double the Company’s size in years to come”, said Ron Lewis, President and Founder of Cosmetic Technologies. “We are already well-positioned to handle such growth with our advanced technical expertise and substantial equipment and infrastructure investments already completed, but KDC offers us the expertise, sales force, facilities and network to achieve this objective. Its excellent track record of sales growth, operational excellence, and superior customer service will add to our history of reliability, competence, and consistency, which has led to a continuous flow of new customers through industry referrals.”
KDC plans to double its production by 2018 and become the leader in its industry, while remaining the only North American player with the critical mass needed to play a major role internationally. Only one year since its recapitalization, KDC has already invested more than $100 M in the development of the company, and in acquisitions such as Cosmetic Technologies, Kolmar and ChemAid, each of which further leverages KDC’s position as segment leader.
KDC is a leader and total solution provider in the contract manufacturing fields of regulated and non-regulated personal care products with sales now in excess of $650 M USD, eight operating facilities run by a most talented and experienced team of professionals. KDC has its head office in Longueuil, QC. KDC has plants in Knowlton, QC, Mississauga, ON, Lynchburg, VA, Columbus, OH, as well as the the KDC ChemAid facilities, located in Saddle Brook, NJ and now the Kolmar facilities in Port Jarvis, NY, and Mahwah, NJ. Altogether, the company employs 2,500 people, including more than 750 in Knowlton. For more information, please visit: www. kdc-companies.com.
ABOUT COSMETIC TECHNOLOGIES
Cosmetic Technologies Inc. is a California-based cosmetics and personal care products contract manufacturer providing turnkey solutions from initial product concept, to formulation, manufacturing, packaging, and warehousing. During its 23-year history the Company has established itself among customers as a trusted and vital resource, playing an integral role in the operation and success of their beauty or personal care brand’s business model. Operating from a state-of-the-art facility in Newbury Park totaling over 100,000 square feet, Cosmetic Technologies manufactures Body Care, Hair Care, Facial Care, Sunscreen, Oral Care, and other personal care products. For more information, please consult www.cosmetictechnologies.com .
ABOUT NOVACAP AND THE NOVACAP INDUSTRIES IV FUND
With $1.5 billion of assets under management, NOVACAP ranks among the top private equity firms in North America. Since 1981, its distinct partnership approach based on operational expertise has helped more than 70 companies in North America accelerate their growth and maximize their value.
Established in October 2014, the NOVACAP Industries IV Fund has currently raised an amount of $365 million from partners such as Caisse de dépôt et placement du Québec, the Fonds de solidarité FTQ, Investissement-Québec, Export Development Canada (EDC) and other institutional partners. NOVACAP expects to complete commitments for its $425-million goal within the next few months. The fund seeks to invest mostly in medium-sized companies in the industrial and manufacturing sectors, as well as in specialized services and distribution platforms. For more information about NOVACAP, consult: www.novacap.ca .
ABOUT CAISSE DE DÉPÔT ET PLACEMENT DU QUÉBEC
Caisse de dépôt et placement du Québec (CDPQ) is a long-term institutional investor that manages funds primarily for public and parapublic pension and insurance plans. As at June 30, 2015, it held CAD$240.8 billion in net assets. As one of Canada’s leading institutional fund managers, CDPQ, which marks its 50th anniversary this year, invests globally in major financial markets, private equity, infrastructure and real estate. For more information about CDPQ: www.cdpq.com
ABOUT INVESTISSEMENT QUEBEC
Investissement Québec’s mission is to foster the growth of investment in Québec, thereby contributing to economic development and job creation in every region. The Corporation offers businesses a full range of financial solutions, including loans, loan guarantees and equity investments, to support them at all stages of their development. It is also responsible for administering tax measures and prospecting for foreign investment. For more information: www.investquebec.com.
ABOUT THE FONDS DE SOLIDARITE FTQ
The Fonds de solidarité FTQ helps drive our economy. With net assets of $11.1 billion as of May 31, 2015, the Fonds is a development capital fund that channels the savings of Quebecers into investments in all sectors of the economy to help create and maintain jobs and further Québec’s development. The Fonds de solidarité FTQ is a partner, either directly or through its network members, in more than 2,550 companies. With 610 605 shareholder-savers, the Fonds helps create, maintain and protect more than 176,000 jobs. For more information, visit www.FondsFTQ.com.
For further information: Sources: NOVACAP/KDC, CDPQ, Investissement Québec, Fonds de solidarité FTQ; Media contacts: For KDC and NOVACAP: Valérie Gonzalo, AGO communications, 514 626-6976, email@example.com; Caisse de dépôt et placement du Québec: Jean-Benoit Houde, 514 847-5493, firstname.lastname@example.org; Investissement Québec: Chantal Corbeil, 514 873-7161, email@example.com; Fonds de solidarité FTQ: Patrick McQuilken, 514 850-4835, firstname.lastname@example.org
Photo courtesy of Shutterstock