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SHOWING COMMITMENT TO HAIR CARE BRISTOL-MYERS TO PAY $250M FOR MATRIX ESSENTIALS

By Published on .

Long thought to be focusing on healthcare at the expense of personal care, Bristol-Myers Squibb Co. is paying an estimated $250 million to acquire Matrix Essentials.

Terms of the agreement weren't disclosed; it's expected to be finalized by fall.

The Solon, Ohio-based marketer of professional cosmetics, and hair- and skincare products has sales of $200 million. It also dominates the $1.3 billion professional beauty category, selling such brands as Systeme Biolage, Matrix Essentials and VaVoom! through salons.

The acquisition follows years of rumors that Bristol-Myers would sell its Clairol unit, the leading U.S. hair color marketer.

It also signals the intent of the $11.4 billion pharmaceutical and personal-care marketer to increase its global competitiveness against L'Oreal and Wella in salons.

"Most importantly, the acquisition shows that Bristol is not walking away from Clairol. Instead, they will intensify their haircare commitment," said industry consultant Allan Mottus.

Bristol-Myers is also rumored to be negotiating a cross-distribution agreement with Beiersdorf, Hamburg, under which Beiersdorf would distribute Clairol and other personal-care products in selected overseas markets. Bristol-Myers might distribute certain Beiersdorf products in the U.S.

A Bristol-Myers spokesman wouldn't comment.

Beiersdorf Chairman Peter Metzger said: "I am not at all aware of that."

A Beiersdorf spokesman denied there are any discussions about cross distribution.

Bristol-Myers intends to increase Matrix's global distribution, now covering salons in 18 countries.

"Bristol-Myers Squibb is committed to ensuring the future growth and global potential of Matrix Essentials," said Michael E. Autera, company exec VP.

Matrix will operate as an independent subsidiary. Michael DeGennaro, VP-corporate development, will become Matrix president, a post held by Matrix co-founder Sydell Miller, who remains chairman.

Matrix media spending was $11.2 million in 1993, according to Competitive Media Reporting. The account is handled in-house, while Bristol-Myers counts among its personal-care agencies J. Walter Thompson USA, New York. No change in agencies is planned at this time.

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