SHISEIDO IN HELENE CURTIS DEAL

Byline: Pete Born

NEW YORK — Shiseido International Corp., a U.S. subsidiary of the Tokyo-based beauty giant, has signed a deal to acquire the North American professional hair products division of Helene Curtis for an undisclosed amount.
Shiseido intends to pair the Curtis professional business with Zotos International Inc., which it acquired in 1988.
The purchase would precisely double the size of Shiseido’s hair salon business in the U.S. Zotos did $72 million at wholesale last year in the professional market, according to Shiseido, while the Curtis brands had sales of $72 million for the fiscal year ended Feb. 1.
With the professional Curtis brands — such as the freestanding ISO (Innovative Styling Options), Quantum and Naturelle — marketed within the Zotos framework, the combined business will occupy the number three position in the U.S. professional hair products rankings behind Matrix and John Paul Mitchell Systems, according to Isao Isejima, chief executive officer of Zotos.
The most specific benefit would come in bolstering Zotos in the permanent-wave category. According to Isejima, Matrix is now the leader, followed by Curtis and Zotos. The combined volumes of the latter two will nearly equal the leader, Isejima said.
The Curtis and Zotos product mixes are similar, and the price points are roughly the same, he added.
Under the agreement, Shiseido is not allowed to use the Helene Curtis name, since the hair care company, which was acquired by Unilever early this year, continues to market its own consumer hair products.
Susan Budman, vice president of marketing and marketing services, said ISO already has a separate identity from Curtis, but on the other brands, all references to the original owner will be deleted. She estimated that the acquisition will be completed around Dec. 10 and that within three months, Zotos will be manufacturing the former Curtis products in its factory in Geneva, N.Y.
The Zotos sales effort is headquartered in Darien, Conn.
Isejima said once Zotos has consolidated its new business in the U.S. and Canada, it will be free to start exporting. It seems unlikely, however, that the Curtis brands will be marketed in Japan or the rest of Asia.
Budman said parent Shiseido had been concentrating on establishing the Zotos name in the region. Malaysia, Thailand, Australia, Japan and Hong Kong are among the 50 countries where Zotos is sold, and the company is in the process of entering China, she added.
Isejima has had experience working overseas for Shiseido. He took charge five months ago at Zotos after serving as president of Shiseido Australia for two years.
Prior to that, he worked in Japan, following six years in Italy. He was senior vice president of sales and marketing in Milan during the period when Shiseido shot to the top of the Italian sales rankings for skin care and makeup.
The acquisition of the Curtis business is another step in Shiseido’s goal of becoming one of the world’s dominant cosmetics companies by the end of the century. Specifically, Shiseido intends to increase its share of foreign sales to 25 percent of total volume, a huge jump over its 8 percent last year.

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