Unilever Agrees to Buy Seventh Generation, Continuing CPG Shopping Spree

Deal Follows Dollar Shave Club Buy, Reports of Talks to Add Honest Co.

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Credit: Seventh Generation
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Unilever has agreed to buy Seventh Generation for an undisclosed sum, the company announced today, intensifying efforts to snatch up fast-growing, e-commerce-focused household and personal-care brands.

The deal comes months after Unilever agreed to buy Dollar Shave Club in a billion-dollar deal and amid reports it's in talks to buy Honest Co. With annual sales of around $200 million annually, Seventh Generation appears around the size of Dollar Shave Club. Honest Co. is bigger, with sales of more than $500 million last year, according to people familiar with the matter.

The 28-year-old Seventh Generation has had double-digit compounded annual sales growth over the past 10 years, Unilever said. And while it's not an e-commerce pure play like Dollar Shave Club, it and other players in the natural/eco-friendly household-products market have for years gotten more than a quarter of their sales online, well ahead of the rest of the consumer package goods industry.

"Seventh Generation has long been a disruptor in the U.S. marketplace, leading the industry in sustainable innovation while attracting new generations of conscious consumers," said Nitin Paranjpe, president of Unilever's Home Care business, in a statement. "This addition to Unilever's product portfolio will help us meet rising demand for high-quality products with a purpose."

The deal puts Unilever back into the laundry and household products business in North America, eight years after divesting its old business, and such brands as All, Wisk and Snuggle, to Sun Products. As with Dollar Shave Club, Seventh Generation is a largely North American brand that presents Unilever with an opportunity for global expansion, and Unilever sells such mainstream detergent brands as Omo and Persil overseas.

Unilever President-North America Kees Kruythoff said the acquisition expands Unilever's portfolio of "purpose-driven brands like Ben & Jerry's and Dove" and demonstrates the company's commitment to its sustainable living plan, by which it looks to grow while halving the environmental impact of its products by 2030.

Seventh Generation CEO John Replogle, who also led Burt's Bees prior to its sale to Clorox Co. nine years ago, said in the statement: "Working together, we are confident we can have a positive impact on the health of billions of people around the world, truly fulfilling our mission of nurturing the next seven generations while transforming global commerce."

Mr. Replogle, who along with Seventh Generation board member Laura Klauberg is a Unilever alum, was seen by many as on a mission to sell the company when he came on board in 2011 following a four-year transition period at Burt's Bees under Clorox. But he said at the time that wasn't his mission, and he was at Seventh Generation more than five years before today's news -- considerably longer than the year he spent at Burt's Bees prior to the Clorox deal.

Seventh Generation and Honest Co. have been on opposite sides of one natural-products controversy of late. The latter has been criticized and ultimately sued over tests conducted and reported earlier this year by the Wall Street Journal that found the sudsing agent sodium lauryl sulfate in its products despite claims to the contrary. Honest Co. has denied it has SLS. Seventh Generation long has used and disclosed SLS, which it doesn't consider to be at odds with its products' natural positioning.

Seventh Generation last year appointed 72 and Sunny as its agency of record and launched a new campaign from the agency, much like Unilever's Axe, which also added the agency last year and tapped it to help launch a new global campaign.