L’Oreal S.A. is an international cosmetics company with $10 billion in annual sales, but the one hole in its portfolio has been products for people of African descent.
Soft Sheen Products Inc., a relatively small Chicago-based company, will help its new parent fill that hole. That’s how executives, speaking publicly for the first time since the acquisition July 1, explained the deal Thursday.
Guy Peyrelongue, president and CEO of Cosmair Inc., L’Oreal’s U.S. subsidiary, said L’Oreal approached Soft Sheen, which has about $95 million in sales.
“Today our presence is almost all over the world, with the exception of people of African descent, who have very specific needs in terms of hair,” Peyrelongue said. “We felt that when we looked at Soft Sheen we saw a great team of people, and we felt if we were able to acquire that expertise and build that expertise, we would have a much better chance of attaining our goals.”
L’Oreal found it shared a lot “in common values” with Soft Sheen, he added.
“L’Oreal is, in fact, a company that was started by a man and his wife, and that’s basically the story of Soft Sheen,” said Terri Gardner, president of Soft Sheen and daughter of the company’s founder. “I’m very comfortable that this organization is capable of helping Soft Sheen meet the vision that we set years ago.”
Soft Sheen will become a division of Cosmair while L’Oreal will expand its ethnic research and development activities to Chicago. Gardner will remain at the helm of Soft Sheen.
Peyrelongue and Gardner are unsure of the impact on employee rolls. .
Analyst Ken Smikle, of Target Market News, said of Soft Sheen:
“The industry has changed so radically that if they don’t accept a sale offer now, the company’s legacy may very well just be lost to the future completely.”
