Procter & Gamble Co. (NYSE: PG) has sold Johnson Products Co., a provider of African-American haircare products, to an investor consortium that includes Rustic Canyon/Fontis Partners and St. Cloud Capital. No financial terms were disclosed.
Procter & Gamble Company (NYSE: PG) has sold its Johnson Products Company unit, one of the world’s most recognized market leaders in African-American hair care products, to RCJP Acquisition, Inc., a newly formed independent entity comprised of Los Angeles-based private equity firms Rustic Canyon/Fontis Partners, LP and St. Cloud Capital LLC, along with an African-American management team of industry veterans. Terms of the transaction were not disclosed.
The company will operate as Johnson Products Company. The new management team will be led by two industry veterans with strong ties to the business, husband and wife team, Eric Brown and Renee Cottrell-Brown. They have extensive experience in the ethnic hair care arena, having both held senior executive positions with the Pro-Line International, Inc. subsidiary of Alberto-Culver Company (NYSE: ACV). Brown will serve as chief executive officer, with Cottrell-Brown as executive vice president.
Founded in 1954 by George Ellis Johnson, Sr., Johnson Products, formerly headquartered in Chicago, has been a mainstay brand for more than a half-century in the African-American community. In 1971, the company became the first minority-run enterprise to be listed on the New York Stock Exchange. Today, Johnson Products offers more than 30 hair care products, including the Gentle Treatment and Ultra Sheen brands. The company is headquartered in Los Angeles, with offices in Dallas.
“The acquisition of Johnson Products represents the renewal of a family of products that revolutionized the ethnic hair care industry starting in the 1950s, and a next stage of growth for a legendary company that has been an iconic figure and model of success for African-Americans,” Brown said. “The new Johnson Products Company will provide us with a platform to bring product innovations and promotions to a unique multi-cultural consumer group and reintroduce the brands to a new generation. We have an outstanding, motivated team, and we are extremely excited and optimistic about the future of this new venture.”
Johnson Products has annualized sales of more than $23 million. Its products are sold throughout the United States and participate in a global market that the company estimates to be approximately $1.8 billion.
The management team brings more than 55 years of experience to the newly formed company. It has helped launched some of the industry’s most successful ethnic hair care brands, including the Soft & Beautiful, Comb-Thru and Just-For-Me product lines, all part of Pro-Line International.
Brown most recently was president of Pro-Line International, which has been part of Alberto-Culver Company since 2000. In January 2004, Brown moved into a corporate position with Alberto-Culver as vice president global business development, where he was instrumental in consummating global licensing, distribution, acquisition and divesture opportunities for many of Alberto-Culver’s global brands.
Brown is joined by Renee Cottrell-Brown, who since 2006 operated a marketing consulting firm, Streetwise Marketing Solutions, based in Arlington, TX, which provides marketing services to start-ups and small-to-medium growth companies that market multi-cultural personal care products. She previously held a 25-year career with Pro-Line Corporation and Pro-Line International, most recently as global vice president of retail marketing.
“It makes me extremely happy to know that the brands of Johnson Products will be owned by people who understand the African-American consumer market and care about the brands,” said founder Johnson, 82, whose company became part Procter & Gamble in 2003 with its acquisition of Wella AG. “Eric Brown and Renee Cottrell-Brown will be successful in re-energizing the company, and I wish them the very best in their endeavors.”
Comer J. Cottrell, founder of Pro-Line International, said, “I am excited and pleased to congratulate Eric and Renee on their acquisition of Johnson Products. We have always had a great deal of respect for the company and its founder. The acquisition will perpetuate the legacy of minority ownership and contributions to the industry.”
Lafayette Jones, president of SMSI-Urban Call Marketing, Inc. and founder of the American Health and Beauty Aids Institute applauds the move and is pleased to see the Brown team at the helm of the re-energized company. “I am very proud that the rich history of African-American entrepreneurship and community involvement continues with the acquisition of Johnson Products from Procter & Gamble,” Jones said. “As second generation industry leaders, Eric Brown and Renee Cottrell-Brown, along with the company’s legacy brands, have a solid foundation upon which to rebuild the company.”
Kacy Rozelle and Marshall Geller of St. Cloud Capital, along with Daniel Villanueva and Gabrielle Greene of Rustic Canyon/Fontis Partners, will join the Johnson Products’ board of directors.
“All of us at St. Cloud are very excited to be part of this transaction and look forward to working closely with this talented management team,” said Rozelle, managing director of St. Cloud.
Gabriel Greene, partner of Rustic Canyon/Fontis Partners, said: “The wealth of experience of the management team, coupled with the support of the expanded board and advisory board, position Johnson Products to reestablish itself as a great source of pride in the community.”
Johnson Products Company has been supported by leading food, drug and mass retailers as well as beauty and barber suppliers for more than 50 years. Jay Forbes, president of the Forbes Connection LLC and former vice president of Drug Store News, said he welcomes JPC back to the forefront of the ethnic hair care industry. “In a market that demands innovation, creativity and thoughtful product positioning, I cannot think of two more talented individuals who better understand the ethnic consumer and the retail community,” said Forbes. “I’m certain that Renee and Eric, with their collective experience over many years contributing to the growth of the Pro-Line family business, will excel in re-energizing Johnson Products, a great legacy company with outstanding brands.”
About Rustic Canyon/Fontis Partners
Rustic Canyon/Fontis Partners, LP is a Southern California-based private equity fund, investing principally in companies in the Southwest with sales between $10 million and $100 million. For more information about Rustic Canyon/Fontis Partners, please visit www.rcfontis.com.
About St. Cloud Capital
St. Cloud Capital is a Los Angeles-based private equity firm that provides growth capital to the lower middle market (companies with annual revenues between $10 million and $100 million) throughout North America. St. Cloud invests in companies across a wide range of industries in every layer of the capital structure, including senior secured debt, subordinated debt, and preferred and common stock. St. Cloud’s investment discipline includes control and non-control investments, and in each case involves partnering with a strong existing management team or experienced industry entrepreneur. For more information about St. Cloud Capital, please visit www.stcloudcapital.com.
About Johnson Products Company
Newly established as an independent company in 2009 and originally founded in 1954, Johnson Products focuses on strategic brand and business development in the ethnic hair care market. The company has been a leading brand for more than a half-century in the African-American community and currently offers more than 30 hair care products under the Gentle Treatment and Ultra Sheen brands.
For more information on the newly acquired Johnson Products Company, its family of brands and to download photographs of the new management team, visit the company’s website at www.yournewjpc.com.