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Dec. 19, 2019, 11:05 a.m. EST

Helen of Troy to buy the Drybar line of products, but not the chain of salons

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By Tonya Garcia

Helen of Troy Corp. /zigman2/quotes/205565021/composite HELE +3.21% said Thursday that it is acquiring DryBar Products LLC, the business that sells the haircare merchandise produced by the chain of blow dry salons. The deal also includes the DryBar intellectual property assets and some production assets and working capital. The deal does not include the chain of salons, called Drybar Holdings LLC. Helen of Troy will grant a global license to Drybar to use the trademark for the salons. The deal is expected to close by Jan. 31, 2020 for $255 million in cash, and it's forecast to be immediately accretive. For calendar year 2019, Drybar Products net sales is expected to be $64 million to $66 million. The company has doubled since 2016, according to a statement from Julien Mininberg, chief executive of Helen of Troy. Drybar products are available in stores like Ulta Beauty Inc. /zigman2/quotes/210513442/composite ULTA +2.25% and Sephora. "At first blush, we like this deal a lot," said D.A. Davidson analysts led by Linda Bolton Weiser. Among the reasons: it offers Helen of Troy a way into the growing prestige hair category, appears to be 3% to 4% accretive to fiscal 2021 earnings per share, and gives the organic sales growth rate a 50-to-60 basis-point bump. D.A. Davidson rates Helen of Troy stock buy with a $184 price target. Helen of Troy stock is nearly flat in Thursday trading, but has gained 25% in 2019. The S&P 500 index /zigman2/quotes/210599714/realtime SPX +1.66% is up 27.6% for the year to date.

/zigman2/quotes/205565021/composite
US : U.S.: Nasdaq
$ 144.51
+4.50 +3.21%
Volume: 33,301
April 9, 2020 11:53a
P/E Ratio
19.02
Dividend Yield
N/A
Market Cap
$3.52 billion
Rev. per Employee
$1.05M
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/zigman2/quotes/210513442/composite
US : U.S.: Nasdaq
$ 205.09
+4.52 +2.25%
Volume: 676,364
April 9, 2020 11:55a
P/E Ratio
16.89
Dividend Yield
N/A
Market Cap
$11.29 billion
Rev. per Employee
$193,562
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/zigman2/quotes/210599714/realtime
US : S&P US
2,795.58
+45.60 +1.66%
Volume: 1.79B
April 9, 2020 11:55a
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