The natural-based oral care line consists of mouthwashes, toothpastes, breath strips and chewing gum and is based on green tea extract, an ingredient that is being increasingly used in oral care products due to its anti-bacterial properties.
“The Dr. Ken’s brand is a strategic fit for us as we expand our oral care business into the fast growing natural products sector,” says Puneet Nanda, President & CEO of Dr. Fresh
Acqusition opens up synergies
The company is also hoping that the acquisition will provide synergies that will help enhance its bottom line, driving the company towards its goal of further market growth within the category.
“With our extensive R&D facilities and in-house state-of-the-art automatic mouthwash production line, we believe we can achieve economies of scale and reduce current product cost substantially, which makes this a very attractive acquisition for us,” says Daniel Enriquez, vice president of sales for Dr. Fresh.
Dr. Fresh was established in 1998 as a niche but innovative oral care player, basing its product development on advanced research and development.
The acquisition of the Dr. Ken’s Floss and Go brand is the latest in its expansion program, which began in October 2008 with the purchase of the Binaca Tex and Dantex oral care brands from New Jersey-based Ascendia after it went bankrupt.
The most recent acquisition puts Dr. Fresh’s yearly turnover in excess of $60m a year, which by industry standards is small, but the company is focusing on one of the fastest growing niches within the oral care category and is looking to leverage this position to fund further acquisitions.
Currently Dr. Fresh’s brands have nationwide distribution in leading retail chains such as Target, Walgreen and Walmart, a factor that has also been crucial in the company’s recent growth.
Natural oral care on the up
The US natural and organic oral care market is already by far the most developed and sophisticated in the world, and it seems that consumer interest in the segment is continuing to grow at a breakneck pace.
The market was valued at $160m in 2008, and according to market researchers Organic Monitor, it is predicted to grow annually at 20 – 25 percent over the next few years.
This growth is largely attributable to increased distribution in mass market outlets combined with the ever-increasing consumer interest in this product area.