Burt Bees & Clorox?

It’s hard to imagine a more unlikely pairing than Burt Bees and Clorox.

Clorox just bought Burt’s Bees for $925 million in cash – not bad for a company that started in 1984 to market beeswax candles.

Burt’s Bees, which develops and sells a popular line of natural personal care products, rang in $55 million in 2003. That year, it sold 80% of the equity to international investment firm AEA Investors for $155 million. AEA, which is known for buying companies, boosting sales and selling them several years later, raised Burt Bees revenue to $170 million this year by getting the company into mass retailers.

That’s when Clorox got interested. The company says it’s looking to green its image and plans to acquire companies aligned with consumer “megatrends” in health and wellness, sustainability, convenience and a more multicultural marketplace. Besides bleach, Clorox owns Hidden Valley salad dressings, Fresh Step cat litter, STP auto products, Glad plastic bags, Kingsford charcoal and Brita water filters. Clorox is launching its first green branded product – a biodegradable, plant-based cleaning line called Green Works.

According to Clorox, the natural personal care market accounts for over $6 billion in annual sales and is growing at 9% a year.

Burt’s Bees products contain at least 95% botanical ingredients – it’s easy to wonder how that will pan out with chemically-oriented Clorox. Founder Roxanne Quimby says Clorox has done a great job of stewardship of its premier brand, Clorox, which has been a household word for almost 100 years. “It was my dream, as founder of Burt’s Bees, to create a ‘household word’ known and used by many Americans, and I believe that the Clorox Co. will support sustainable, patient and steady growth of the Burt’s Bees brand.”

In other news, Kellogg Co. is buying Wholesome & Hearty Foods, which is the parent company of Gardenburger. It’s also buying Bear Naked, a granola manufacturer (and they said granola crunchers couldn’t make money!
). Kellogg paid about $122 million for both companies. Kellogg has a history of acquiring natural food brands – it owns Kashi cereals, Morningstar Farms, Worthington and Loma Linda.

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