According to The Wallstreet Journal, Unilever is planning to acquire Alba Jessica’s Honest Company, which specializes in household goods. The proposed deal is likely to cost Unilever a whopping $1 billion, which is believed to be below the start-up’s initial valuation.
The London-based Unilever, which owns Lynx body sprays, Dove soap plus Ben and Jerry’s cream, is currently on a buying spree, acquiring up existing creative companies which appeal to younger individuals to aid maintain and preserve its dominance in the world goods consumer market.
However, both Honest and Unilever declined to comment anything concerning the proposed deal, which was initially reported by the Street Wall Journal. Jessica Alba’s Honest Company, which boasts of a devoted customer fan-base of middle-aged mothers who purchase its diapers, beauty products, and household cleaners through internet subscription service, is also believed to be looking at the prospect of floating on the stock market.
Bearing in mind that Honest was previously, in its recent fundraising drive conducted last year valued at around $1.7 billions, the speculated sale price is surprisingly lower.
Honest attracts Unilever due to its green and natural goods for household cleaning which offers a lucrative market in the United States and overseas alike. So whether this is a wise move by Unilever or not is still debatable, bearing in mind that Jessica Alba’s Company is currently hit with a host of class-action lawsuits by clients who claim that the company’s products are just labeled as natural and organic deceptively when they have harmful artificial ingredients at their disposal.
Jessica, 35, who has been in the world of acting since at the age of 13, and notably starred in Dark Angel and Fantastic Four, has however dismissed the lawsuit claims as false and baseless. She says that her company is a simple target apparently because her brand often gets a unique attention compared to other brands. She maintains that the ingredients and the products of hers are safe, and that is why she is quite confident about winning the cases.
Unilever’s chief executive officer, Polman Paul, clarified that their company was seeking to acquire newer ideas as compared to the prospect of coming up with new business models and products in the house. A company that is innovative must explore outside as much as inside. The primary incubators for our future innovation abilities are likely to be found on the outside than the inside,’ said Polman, earlier this year, in an interview conducted by Bloomberg.
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