The owner of Schick razors, Edgewell Personal Care (NASDAQ: EPC), announced it will acquire shaving startup Harry’s Inc. in a cash and stock deal valued at nearly USD 1.4 Billion. The combined company will hold around 21% of the razorblade market.
“Building on Edgewell’s and Harry’s complementary strengths, our combined company will have leading brands and omni-channel capabilities that are essential to meet the needs of the modern consumer and win in today’s market environment” said Rod Little, Edgewell President and Chief Executive Officer. Harry’s co-chief executives, Andy Katz-Mayfield and Jeff Raider, will serve as co-presidents of Edgewell’s U.S. operations.
Since emerging as an e-commerce business in 2013, Harry’s has moved into both Target Corp. (NYSE: TGT) and Walmart Inc. (NYSE: WMT) stores.
Edgewell looks to gain ground on Proctor & Gamble Co. (NYSE: PG) owned brand, Gillette, which has notoriously dominated the male grooming market. But even the front runner has faced trouble recently amid low-cost competition like Dollar Shave Club. Unilever (NYSE: UN) bought Dollar Shave Club in 2016 for around USD 1 Billion in cash. According to a ResearchAndMarkets.com report, the global men’s grooming industry is expected to hit USD 78.6 Billion by 2023, up from USD 57.7 Billion in 2017.
On Thursday, Edgewell reported net sales of USD 546.7 Million in the second quarter of fiscal 2019, an 8.9% decline from the year-quarter prior. Earnings came in at USD 1.13 a share, down from USD 1.31 a year earlier. Shares of Edgewell stock are down 22% over the last 12 months.