Hanoi - Unilever agreed to purchase Dollar Shave Club LLC to get a piece of the fast-growing subscription grooming products business.
The transaction is expected to close in the third quarter and is subject to regulatory approval, Unilever said in a statement. The terms of the deal were not disclosed. The deal is worth $1 billion, Fortune reported, citing sources close to the deal.
Closely held Dollar Shave Club, based in Venice, California, operates a subscription model that’s eating into market share of the $3 billion men’s shaving industry in the US. Dollar Shave is competing against established razor brands, such as Procter & Gamble’s Gillette and Edgewell Personal Care’s Schick. Dollar Shave Club forecasts $200 million in sales in 2016.
Dollars Shave Club has 3.2 million members, according to the statement. The company sells razors for as low as $1 month, as well as shaving supplies. It recently expanded its product line into hair care, offering pomade and hair cream that’s made a comeback with young male consumers.
Global sales of men’s grooming products is expected to grow 3 percent annually through 2020. E-commerce will be a key driver of personal care sales as online demand strengthens, according to Bloomberg Intelligence analyst Deborah Aitken.
Michael Dubin, Dollar Shave Club founder and chief executive officer, will continue in the role, according to the statement.
BLOOMBERG