Sally Beauty extends Midwest reach with latest acquisition

By Andrew McDougall

- Last updated on GMT

Related tags Sally beauty holdings Midwestern united states Illinois

Sally Beauty Holdings (SBH) has announced the acquisition of Aerial Company with the aim of extending its distribution reach and breadth of professional beauty product offerings in the Midwest region of the US.

The Texas-based firm paid $70 million for the Midwest competitor and acquired the firm through its subsidiary, Beauty Systems Group (BSG).

The acquisition will be applied to Sally’s balance sheet in fiscal year 2011.

“This acquisition is consistent with our strategy to extend our reach in US geographies where we do not already have a strong presence,”​ said John Golliher, president of BSG.

“We believe the addition of Aerial will strengthen our position in this important region of the US and create additional value for our customers, suppliers, and our stockholders.”

Gary Winterhalter, CEO of Sally Beauty Holdings, believes Aerial’s position as one of the leading distributors, will strengthen SBH and BSG’s stronghold in the Midwest region.

“The addition of Aerial will compliment BSG's portfolio​ and expand its geographic footprint in the Midwest, directly supporting our objective to grow Sally Beauty Holdings over the long-term,” ​he explained.

Aerial was founded in 1912 and is based in Marinette, Wisconsin. The company employs over 700 people, including over 70 direct sales consultants. It recorded sales revenue, in fiscal 2009, of approximately $100 million.

The company owns 82 professional-only beauty supply stores located in Wisconsin, Northern Illinois, Kansas, Michigan, Minnesota, Missouri, Iowa, Nebraska, Colorado, and North and South Dakota, and operates two distribution centers, in Marinette, and Lincoln, Nebraska.

Ryan Hmielewski, president of Aerial, stated, "We are pleased to join the BSG team to achieve our goal of becoming the professional beauty industry's best full-service distributor. I look forward to the new opportunities of the combined companies.”

Shares of SBH rose in trading this week following the acquisition.

According to the Associated Press, SBH joins a number of companies who are taking advantage of how the recession has hurt some competitors, leading to lower interest rates to make acquisitions.

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