By and  on January 30, 2008

LONDON — PZ Cussons is dipping its toes into the spa market.

The U.K.-based personal care and consumer goods firm announced Tuesday it acquired Sanctuary Spa Holdings for 75 million pounds, or $148.6 million at current exchange, from private equity firm HgCapital. The business includes treatment and bath-and-body lines, plus a day spa located in Covent Garden here.

"The Sanctuary business represents an excellent strategic opportunity for PZ Cussons, giving us a greater presence in the premium segment of the U.K.'s personal care market through an established and well-respected brand," said Alex Kanellis, group chief executive of PZ Cussons plc, in a statement. "We see considerable opportunities to create further value from the Sanctuary business, through combining our new product and brand development expertise with theirs, developing the brand's international sales and exploring opportunities to develop the spa concept further. There are also synergies to be derived, particularly in the area of supply chain."

PZ Cussons, whose personal care portfolio includes Imperial Leather, Carex and Original Source, rang up revenues of 299.5 million pounds, or $607.2 million at average exchange, for the six-month period ended Nov. 30.

Sanctuary's revenues for the year ended Aug. 31 came in at 26.3 million pounds, or $51.5 million at average exchange, while pretax profits came in at 3.9 million pounds, or $7.6 million.

The Sanctuary brand, which is carried in Boots the Chemists in the U.K. and Target in the U.S., represents 70 percent of Sanctuary Spa Holdings revenues. The Sanctuary Spa hosts 64,000 clients annually, according to the company.

"The iconic spa in Covent Garden underpins our brand authority and has enabled us to develop the products business into one of the U.K.'s leading body care brands," said Alice Avis, chief executive of The Sanctuary Spa, in a statement released by HgCapital. "We have also expanded the business into international markets, with particular success in the U.S., where sales grew by 80 percent over the Christmas period.

"PZ Cussons has an excellent reputation in the industry, and we look forward to working with them to develop The Sanctuary Spa further, both in the U.K. and internationally," she continued.

— Brid Costello

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