According to the Wall Street Journal Tuesday, home cleaning products maker S.C. Johnson & Son Inc. is eying the air-freshener business of Sara Lee Corp. (SLE), in a combination that could see S.C. Johnson's Glade brand and Sara Lee's Ambi Pur brand create a formidable player in Europe.
The business that was reportedly also being eyed by consumer-products giant Procter & Gamble Co. (PG) in October, could fetch more than $700 million. Sara Lee and S.C. Johnson officials both declined to comment on the reported deal.
Ambi Pur, the flagship brand of Sara Lee's air-freshener business, had about $470 million in sales last year. S.C. Johnson's Glade has a roughly 25% share of the European air-care market, while Ambi Pur controls about 10%.
Sara Lee, which has been restructuring since 2005, spinning off or selling slower-growth businesses, with an aim to focus on its core food and beverage business, on March 30 said that it was reviewing strategic alternatives for its International Household & Body Care business, including a possible sale, after receiving interest in the division.
An earlier report on the Wall Street Journal had noted that Sara Lee hired Goldman Sachs Group Inc. (GS) to find out possible buyers for the complete International Household & Body Care business, which could fetch a total of over $3 billion.
As per the report, the prospective bidders for the business included Anglo-Dutch consumer giant Unilever Plc (UL, UN, ULVR.L), and U.K. based cleaning products maker Reckitt Benckiser Plc (RB.L, RKBKF.PK), while the possible bidders from the U.S. included Racine, Wisconsin-based S.C. Johnson and New York-based consumer products maker Colgate-Palmolive Co. (CL).
In September, Sara Lee announced the sale of its Utrecht, Netherlands-based global body care and European detergents businesses to Unilever Plc (UL, UN, ULVR.L) in a cash deal worth $1.9 billion, as part of its aim to focus on its core food and beverage business.
Sara Lee has agreed to accept the offer, and the deal is expected to be close during calendar year 2010. The segment's Body Care products include Bath & shower, deodorants, baby care, men's toiletries and oral care brands like Sanex, Duschdas, Radox, Zwitsal, Brylcreem, Prodent and Zendium.
Sara Lee now added that it has also received significant interest in the remainder of its household business and is continuing to pursue divestiture options for this business, including non-European cleaning brands. The business, which is not included in the proposed transaction, includes the Ambi Pur air care brand, Kiwi shoe care, Ridsect insecticides and White King bleach brands. The company is continuing to pursue divestiture options for these businesses, which include air care, shoe care, insecticides and non-European cleaning brands.
S.C. Johnson, who's board meets next week for discussions on the reported deal, is also said to be interested in other parts of Sara Lee's international household and personal-care business, which includes insecticides and Kiwi shoe polish. The other parts of the household-products business totally could fetch Sara Lee about $1 billion.
Sara Lee had originally hoped to sell the entire International Household & Body Care business to a single buyer, but soon had to settle for a piecemeal sale.
SLE closed Tuesday's regular trading session at $12.20, up $0.22 or 1.84%, on a volume of 5.14 million shares, lower than the three-month average volume of 7.50 million shares.
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