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03/02/2021

Reckitt Benckiser Sheds Dr. Scholl’s Brand to Yellow Wood Partners

Boston-based private equity firm Yellow Wood Partners LLC, has entered into an agreement to acquire the Scholl footcare brand, which operates globally outside of the Americas, from U.K.-based consumer-goods company Reckitt Benckiser Group plc. The acquisition will reunite Scholl with the Dr. Scholl's brand as one entity after 30+ years of separate ownership. The combined business generates annual retail sales exceeding $700 million with leading market shares in the footcare category globally.

The Dr. Scholl's brand is a category leader at brick-and-mortar and e-commerce retailers in the U.S. Similarly, the Scholl brand is a category leader in various regions such as France, Italy, Germany, the U.K., Australia and many other markets outside of North America with deep penetration at both major retailers and independent pharmacies across Europe. In addition to its footcare products, the Scholl brand provides a diversified portfolio of skin care products, insoles, and treatment solutions for targeted foot conditions. The combination of Scholl and Dr. Scholl's will create a global footcare brand operating in 50+ countries as an integrated business.

Yellow Wood acquired the Dr. Scholl's brand in the Americas from Bayer AG in 2019 and has since successfully built out a full standalone Dr. Scholl's organization. Successful business enhancement initiatives since acquiring the business include building its e-commerce capabilities, accelerating new product development, strengthening the senior management team, and optimizing the consumer marketing mix.

Tad Yanagi, partner at Yellow Wood, said, "Our experience of successfully executing corporate carve outs has helped us gain a deep understanding of the many complexities that accompany the separation of an operating subsidiary from a large global parent company. Our previous experience with other global multinational CPG companies enabled us to work directly with Reckitt Benckiser to create this opportunity. We look forward to using the full Yellow Wood operating capabilities to complete the Scholl transaction in a smooth manner. We are excited to bring the operating focus required to achieve what we believe is a strong future growth plan for the business that will benefit customers and employees around the world."

The transaction is expected to be completed by the third quarter of 2021 and is subject to normal and customary closing conditions.

Dr. William Matthias Scholl started the brand in 1906 and over the next several decades developed many innovative products and grew the company in the U.S. and internationally. The brand has been owned by several multi-national corporations over the last 50 years, and rights to the brand were divided amongst the Americas and the rest of the world over 30 years ago. Bayer bought the Dr. Scholl's Americas business in 2014 as part of its acquisition of Merck & Co.'s consumer health unit. Yellow Wood acquired rights to the Dr. Scholl's brand in the Americas in 2019 from Bayer and established the Scholl's Wellness Company. RB has owned the rights to the Scholl brand outside the Americas since its 2010 acquisition of SSL International, plc.