Following in the footsteps of Carol’s Daughter being bought by L’Oreal last year, another popular hair company that caters to black women and men has made some big changes.
According to the Wall Street Journal, private equity firm Bain Capital is now a minority stake owner in Sundial. Although financial information about the merger has not been made public, Sundial is reportedly valued at $700 million and has annual revenue of about $200 million.
Sundial’s sales have been largely in the U.S. and the products are predominantly purchased by African-Americans. Bain’s investment is aimed at boosting growth by targeting a broader market that isn’t defined by ethnicity, said Ryan Cotton, a Bain managing director. The investment also will allow some existing shareholders to cash in, a person familiar with the matter said.
Expanding beyond Sundial’s core customer base may require a balancing act. Earlier this year, Sundial’s SheaMoisture brand drew criticism from some of its African-American customers on social media after the company put out a meme on Twitter with the image of a Caucasian toddler. “We will make sure we are serving our core customers while engaging with a broader audience that’s interested in natural products and healthier ingredients,” Mr.Cotton said.
Sundial will retain a majority stake in the company.
Image Credits: Sundial