Sale of PDC Brands Recognized for its Value Creation and 12x Return and 77% IRR
BOSTON, March 19, 2018 – Yellow Wood Partners, a Boston-based private equity firm focused on investing in consumer brands and companies, was awarded Deal of the Year from Buyouts Magazine, in recognition of the firm’s $1.425 billion 2017 sale of PDC Brands, which yielded a return of 12x and a 77% IRR.
Highlighting Yellow Wood’s investment in PDC, the Buyouts termed the transaction “a home-run-level investment that makes it this year’s Buyouts Deal of the Year.”
Founded in 1981, PDC Brands (f.k.a. Parfums de Coeur) is a global beauty, personal care, and wellness company with a diverse portfolio of market leading brands. PDC markets high quality products at accessible price points across multiple consumer product categories, including: Bath and Body Care, Multi-Cultural Hair Care, Fine Fragrance, Cosmetic Eyelash and Nail, and First Aid, to retailers in over 50 international markets.
“We basically took a mundane opening-price point fragrance business and created a double-digit-growth consumer products juggernaut,” commented Dana Schmaltz, Founding Partner of Yellow Wood Partners.” Subsequent to the acquisition in 2012, Mr. Schmaltz noted that the Yellow Wood investment partners “met with the management team at least once a month, every month, for five years.” The PDC deal, he added, “validates our strategy of buying a platform and building a really valuable company. It was a labor of love.”
Yellow Wood acquired the original fragrance part of PDC (Parfums de Coeur) for $160 million in September 2012, and, according to Buyouts, “Under Yellow Wood’s management, PDC transitioned from a tightly controlled founder-owned business to a broader, more balanced and scalable organization.”
Yellow Wood accomplished several strategic initiatives, including installing new senior managers, reallocating marketing spending into more appropriate programs and increasing the marketing budget by more than 4x, improving the supply chain, and furthering international expansion. PDC completed five add-on acquisitions, all of which were sourced by Yellow Wood and acquired outside of auction processes, bringing new brands under the PDC umbrella.
In 2017, William Blair and Jefferies conducted an auction to sell PDC, which led to the sale to CVC for $1.425 billion. In less than five years, PDC’s revenue increased by more than 4x and Ebitda grew by more than 5x.
Yellow Wood follows a prestigious group of previous winners. Since 1990, the editors of Buyouts have honored exceptional buyouts with Deal of the Year Awards in six categories. “We are truly honored to be recognized with this award, given the stiff competition and the high-caliber of past recipients.”
About Yellow Wood Partners
Yellow Wood Partners is a Boston-based private investment firm that invests exclusively in the consumer industry in the middle market. The firm seeks to acquire branded consumer products across a variety of channels including mass, drug, food, specialty, club and e-commerce. Yellow Wood’s success in driving growth and operational efficiencies is based on the team’s combination of investment expertise and complementary marketing, sales, finance, operations, and international skills which creates strong partnerships with the management teams of portfolio companies. For more information, please visit www.yellowwoodpartners.com.
Contact: Chris Tofalli
Chris Tofalli Public Relations, LLC