Alberto Culver deal may draw interest from rivals

Posted Sep. 28, 2010 at 6:12 a.m.

Bloomberg News | L’Oreal SA and Henkel AG could be interested in Alberto Culver Co., which Unilever yesterday agreed to buy for $3.7 billion, JPMorgan Chase & Co. analysts said.

Alberto Culver shares rose 20 percent to $37.64 yesterday after the deal was announced, above the $37.50 a share Unilever agreed to pay for the maker of VO5 and TRESemme hair-care products. Unilever said there is a $125 million breakup fee if the deal is terminated.

“The market seems to be expecting another bid, as the stock is trading through the bid,” analysts led by John Faucher at JPMorgan, said in a note dated Sept. 27. It seems that Alberto Culver “did not auction itself off, but rather negotiated directly.”

The purchase was London- and Rotterdam-based Unilever’s biggest in a decade and followed the purchase of a Sara Lee Corp. unit personal-care unit last year.

Beiersdorf AG was also mentioned as possibly being interested by JPMorgan. A competing bid for Alberto Culver isn’t “an option for Beiersdorf,” spokesman Ralph Esper said by e- mail today.

Stephanie Carson-Parker, a spokeswoman for L’Oreal, the world’s largest cosmetics maker, declined to comment on a possible offer. Wulf Klueppelholz, a spokesman for Henkel, declined to comment on whether the German company is considering a competing bid. Unilever spokesman Paul Matthews declined to comment.

“The existence of a break clause between Unilever and the board could make a counterbid more complex but not impossible,” wrote Bank of America analysts including Nico Lambrechts today.

Alberto Culver is based in Melrose Park, Illinois.

– Bloomberg News

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