Trade News
JohnsonDiversey announces name change and exciting investment deal to boost growth
Cleaning industry giant JohnsonDiversey and Clayton Dubilier & Rice - one of the oldest private equity investment firms in the world, announced an agreement under which a CD&R-managed fund will invest $477 million for a 46% equity interest in JD as part of a broader recapitalisation transaction valued at $2.6 billion. The recapitalisation will provide the company with the financial flexibility to accelerate growth in the global commercial cleaning and hygiene market. In addition to the CD&R fund investment, the transaction contemplates a debt financing package of approximately $1.9 billion.
With annual sales of more than $3.0 billion into more than 175 countries, JohnsonDiversey is a leading global provider of commercial cleaning, sanitation and hygiene solutions. The company serves commercial customers in the building, retail, healthcare and food and beverage sectors, as well as large, public sector clients such as the UK's National Health Service and the State of New York. Among its private-sector customers are The Coca-Cola Company, PepsiCo., pharmaceutical retailer Walgreens and global facilities services provider ISS.
“JohnsonDiversey is a market leader providing innovative products and services to meet the needs of a world increasingly concerned about health and hygiene,” said Richard J. Schnall, a CD&R partner. “The management team has positioned the company for future growth, and we look forward to working closely with them to continue building on the company’s competitive strengths and creating an even more valuable enterprise over the long term.”
Under the terms of the agreement, the Johnson Family of Racine, Wisconsin, will retain 50% ownership in the company, and S Curtis Johnson will remain Chairman. CD&R Operating Partner James G. Berges will serve as Chairman of the Executive Committee. Unilever will also retain a 4% ownership interest in the company. JohnsonDiversey will continue under separate agreements to sell and distribute into the commercial market certain Unilever and SC Johnson & Son, consumer-branded products.
“This is an exciting development in the evolution of our company,” S Curtis Johnson said. “The Johnson family is pleased to move forward with a proven business builder and strong equity partner of CD&R’s caliber. The firm’s integrity, culture and values align well with our own.”
JD President and CEO Ed Lonergan added: “We’ve made great progress in recent years and continue to be our customers’ partner of choice for superior and sustainable cleaning and hygiene solutions that protect human health and the environment. CD&R’s investment provides both financial flexibility and access to the firm’s significant operating expertise that will help us continue to achieve our long-term objectives.”
In recent months, JD has announced major steps toward protecting human health and the environment, including:
A comprehensive product and training guide to respond to the H1N1 flu virus.
New product innovations that reduce chemical, water and energy use while protecting workers; and Charter membership in the World Wildlife Fund Global Water Roundtable.
JD has been one-third owned by Unilever NV since its acquisition of DiverseyLever in 2002. As part of the 2002 acquisition, it agreed to purchase all or part of Unilever’s ownership at a future date.
The company has also announced that it will adopt a new corporate identity that reflects elements of the strong global brand equity in the current name and also retains the depiction of a water lily in its logo, a reflection of the Johnson family heritage of environmental leadership. The company’s new name will be simplified to Diversey, Inc. and its identity will be formally captured in the new tagline, 'for a cleaner, healthier future'.
“Our new identity will both acknowledge our rich heritage and offer a compelling view of the enduring benefits that our products and services provide,” S Curtis Johnson said. “Our people are inspired by the difference we make in people’s lives.”
The transaction, which is conditioned upon completing the debt financing and customary regulatory approvals, is expected to close prior to the end of the year.
