redox brands
chempro, inc. will be merged with redox brands, a majority - owned portfolio company of allied capital, to form cr brands, inc .
chempro is a consumer products company that manufactures and markets branded and private label heavy - duty household cleaning products. its primary brands include mean green, pine power and magnum power. with the merger of redox brands, its primary cleaning / detergent brands of biz and oxydol will fall under chempro' s production .
allen mcintyre of spartanburg' s chempro has been named chief executive officer of cr brands, and rich owen from redox has been named chief operating officer .
allied originally invested in redox in march 2001. it followed up with another investment in august 2002. owen and redox co - founder todd wichmann have a minority stake in the company. wichmann left redox in 2002 to start healthpro brands inc. , which has licensed fit fruit and vegetable wash from procter. but he still holds his original ownership in redox .
chips off the p. & g. block; can a start - up clean up with cast - off brands ?
that makes redox a small part of allied' s $ 2 billion portfolio, napoli said .
besides, many industry experts say, giants like procter & gamble do not shed brands unless they have a good reason to do so .
chips off the p. & g. block; can a start - up clean up with cast - off brands? - the new york times
in some ways, redox' s timing could not be better: behemoths like p. & g. , hoping to assuage wall street' s anxiety over sagging earnings, are becoming more aggressive in dropping brands that are no longer among the market leaders .
two former procter & gamble co. executives formed the west chester - based consumer products firm in 2000. it bought the oxydol and biz brands from procter shortly after .
first, instead of buying the leader in small markets - - a model exemplified by aurora foods inc. , which has bought brands including duncan hines, log cabin and van de kamp' s, with some success - - they will buy small brands in large markets. that way, they can focus on competing for customers rather than trying to expand a market .
he and mr. owen had just quit their jobs at p. & g. to form redox brands inc. , a company that specializes in buying once - famous laundry and cleaning brands that giants like their former employer are discarding. their first - - and so far only - - purchase was procter & gamble' s oxydol laundry detergent brand, in a deal that calls for p. & g. to continue to be involved in the product. the financial terms of the deal have not been disclosed .
chempro sells its products through discount stores, as well as through grocery chains. redox sells its products primarily into the mass and grocery channels .
mr. wichmann, the redox president, and mr. owen, the chief operating officer, also say they have two distinct tactical advantages .
and as companies like proctor & gamble and unilever scramble to shed old brands, mr. wichmann and mr. owen have a steady stream of product offerings from which to choose. in addition to oxydol, for example, p. & g. recently put biz, a bleach detergent, up for sale. (the men would not comment on whether redox was considering acquiring it. )
their professor, sandy eustis, was impressed by their enthusiasm but did not like their business plan. he voiced concerns that have since been echoed by redox' s critics .
it makes more sense this year to harvest your investments ,
he said .
redox is doing well, and the pricing is attractive, so it would be logical .
when we decided to take our company to market we knew we had a pretty good base. with us servicing our core stores and redox in the midwest and southwest we' re a much stronger company .
redox seems like one of the investments that has worked out for them ,
napoli said .
this year, prices for buyouts have gone up, so if they have the chance to sell some of those, it would make sense .
robert napoli, an analyst who tracks allied capital for piper jaffray & co. in chicago, said he wouldn' t be surprised if allied tried to sell redox. allied has sold some investments this year as the market for selling private companies has improved .
although p. & g. would not comment on its relationship with redox or the specifics of the deal, it said in a prepared statement that oxydol, which represented a minute portion of company sales,'' no longer provided a strategic fit.''
spartanburg, sc — chempro inc. , a chemical company started in spartanburg 16 years ago as a manufacturer of cleaning supplies, has been acquired by allied capital corp. for $ 99. 2 million, according to an article on the spartanburg herald - journal ”s website, urltoken. chempro will merge with redox brands, a majority - owned portfolio company of allied capital, to form cr brands inc. , according to the article. in the article, john shulman, managing director of allied capital, said: “the combination of chempro and redox represents a major strategic opportunity for both companies. from the opportunity to cross - sell products through their complementary channels, to the significant operational advantages from streamlining production, purchasing and distribution, the combination of these businesses makes enormous sense. ” click here to read the full article. for related information, click here. to return to today”s news, click here. to discuss this topic with other industry professionals, click here. for a free subscription to cm e - news daily tm, the daily news service for the building maintenance industry, click here. for a free introductory subscription (or subscription renewal) to cm / cleaning & maintenance management® magazine, the leading publication for the facility maintenance and contract cleaning industries, click here .
the combination of chempro and redox represents a major strategic opportunity for both companies ,
said john shulman, managing director of allied capital .
from the opportunity to cross - sell products through their complementary channels, to the significant operational advantages from streamlining production, purchasing and distribution, the combination of these businesses makes enormous sense .
p. & g. was impressed by their plan. company officials even spoke to venture capitalists on their behalf, the pair said, and a group of investors led by the meriwether capital corporation in new york agreed to finance redox. the deal for oxydol was completed in a month, and both men were allowed to keep their jobs until it was done .
under the deal, procter & gamble, arguably the american consumer products company with the greatest influence among retailers, will still take care of the ordering, shipping and billing systems used for oxydol, which will continue to be made at a p. & g. plant. it also has an undisclosed minority stake in the company. redox, based in the cincinnati suburb of west chester, ohio, will be making the strategic decisions .
the cost of allied' s investment in redox was listed at $ 22. 2 million june 30, according to allied' s form 10 - q filing with the securities and exchange commission. that was mostly through debt securities and preferred stock, but it also includes a $ 3. 2 million loan and warrants worth about $ 500, 000. its total investment is now valued at $ 25. 35 million, according to the filing, thanks to an increase in the value of its preferred stock .
lately, mr. owen and mr. wichmann have been busy preparing oxydol for the first redox ship date this september. and in a recent conference call, they discovered some of the difficulties of being so closely tied to procter & gamble. for every 600 boxes sold, the men want to give retailers 300 boxes free. p. & g.' s system is not configured to handle free boxes, so they have to find another way to distribute them. they are also working on formulating a liquid detergent, and preparing a radio campaign .
chempro, inc. , a company that started in spartanburg 16 years ago as a producer of cleaning supplies, has been acquired by allied capital corp. for $ 99. 2 million .
this company is a real nice story ,
mcintyre said .
i grew up in this company when i came to spartanburg 16 years ago. we took some pretty good products and pushed hard .
chempro retains its 75 employees. it is headquartered in spartanburg and has a warehouse in cowpens. mcintyre said he expects growth to occur .
we produce the products so there will be some growth. we' re landlocked here (141 venture blvd .). cowpens is an option. but we have time to see what we need to do ,
mcintyre said .
we' ve sold our product to family dollar, dollar general and wal - mart so we have a solid base ,
mcintyre said .
allied capital' s acquisition financing took the form of debt and common equity .
allied capital corporation, a washington, d. c. - based business development company with total assets of more than $ 4 billon, invests in american companies seeking a long - term financial partner and access to managerial resources often unavailable to smaller companies .
the company' s private finance portfolio includes investments in more than 100 companies that generate aggregate revenues of more than $ 10 billion and employ more than 90, 000 .
jim fair can be reached at 562 - 7267 or jim. fair @ urltoken
choose the plan that' s right for you. digital access or digital and print delivery .
© copyright 2006 - 2018 gatehouse media, llc. all rights reserved • gatehouse news
original content available for non - commercial use under a creative commons license, except where noted. goupstate ~ 189 west main street, spartanburg, sc 29306 ~ privacy policy ~ terms of service
choose the plan that’s right for you. digital access or digital and print delivery .
urltoken no longer supports internet explorer 9 or earlier. please upgrade your browser .
todd wichmann and richard owen barreled into the procter & gamble headquarters last month and were about to head upstairs when the security guard stopped them .
waiting for permission to enter a place they had worked almost all their adult lives felt'' bizarre, weird,'' mr. wichmann (pronounced wick - man) said as he fiddled with his red visitor' s badge .
but building a strong company out of a collection of jilted labels is tough going. other companies, notably in the food industry, have tried; few have succeeded .
'' buying an orphaned brand isn' t necessarily a challenge,'' said david a. goldman, director of equity research at suntrust equitable securities.'' consolidating them into one entity that makes sense, has operational efficiencies, and has critical mass, well, that' s another matter.''
oxydol was p. & g.' s oldest brand of laundry detergent, introduced in 1927. while it has a long history - - it sponsored the'' ma perkins'' radio show, the first so - called soap opera, in 1933 - - naysayers doubt that a rich heritage convinces consumers to buy a detergent .
'' the question is: is oxydol such an ancient brand that it is valueless and not worth it to revive it?'' said clive chajet of chajet consultancy, a branding consultant in new york.'' as far as i' m concerned, they' re starting from scratch in a category where it' s hard to differentiate one brand from another.''
sales of oxydol have been sinking over the decade and are dwarfed by those of the market leader, p. & g.' s tide .
despite all this, mr. wichmann, 30, and mr. owen, 31, are convinced they will succeed. their aim is to increase oxydol' s share of the $ 6 billion market for liquid and powdered detergent to 2 percent in the next five years from its current one - tenth of a percent. (by comparison, mr. wichmann said, tide now has around 35 percent of the market. )
though they are dealing in an old - economy business, they say, they are helped by some new - economy factors. the expansion of contract sales makes it easier for them to hire a company to sell their products. internet technology allows them to hold'' virtual'' meetings with business contacts, slashing travel costs .
second, they can tailor their packaging and pricing to fit the needs of smaller retailers, something that larger, bureaucratized companies cannot do .
'' twenty years ago or even five years ago, there was no way to do what we' re doing,'' mr. wichmann said.'' we want to be a virtual organization. we don' t want any plants. we don' t want any money going to fixed assets.''
he can make such a bold statement in part because he has p. & g. in his corner .
mr. wichmann and mr. owen acknowledge that their former employer influences their decisions.'' our relationship with p. & g. is very important and we do live by their rules,'' mr. wichmann said .
though bitten by the entrepreneurial bug early on, the men were, after all, trained by the company whose employees are widely known as'' proctoids,'' distinguished by their efficiency and obedience .
mr. owen and mr. wichmann met as interns at the company in the summer of 1991, both researching laundry detergents. they cemented their relationship when they returned after graduating the next year. though both started at p. & g. as chemical engineers, mr. wichmann, who worked on oxydol early on, later went into marketing while mr. owen joined the sales and finance side .
from the new york times. you may opt - out at any time .
you agree to receive occasional updates and special offers for the new york times' s products and services .
they started business school together in 1994, attending xavier university at night. for their final project, the pair designed the american detergent corporation, a hypothetical company that bought oxydol from procter & gamble - - a brand they said they chose somewhat randomly .
'' i said,' why would you want to go into a business that' s dominated by huge players?''' recalled dr. eustis, who is now executive director of the center for adaptive management, a nonprofit research group in cincinnati.'' it' s a slow - growth, mature industry dominated by large players who spend huge sums of money on consumer marketing and advertising, and that presents real difficulties for a smaller, entrepreneurial company.''
the men were not deterred. when the announcement of the oxydol sale popped up on the office intranet in march, mr. wichmann knew he had to talk to mr. owen .
p. & g. had long neglected oxydol; the detergent did not even have the company' s fixture of a brand manager to babysit the product. though p. & g. did not see much of a future for the brand, the two men did .
while he drove home the night of the announcement, mr. wichmann called mr. owen from his cell phone. all he needed to say was,'' hey, rich, american detergent corporation might be in business.''
as they hatched their plans over the weekend, mr. wichmann said, they found themselves in a chicken - and - egg situation .
they had to persuade p. & g. to sell the brand to them instead of to an established company with deep pockets.'' we knew we needed to have a big angle for procter & gamble to want to do this,'' mr. owen said.'' this thing had to be much bigger than just oxydol.''
to do that, they needed to assure p. & g. that they had strong backers. but to get those backers, they had to convince venture capitalists that p. & g. was intent on completing the sale. they also needed to keep their identity a secret so that if the deal did not go through, they would still have their jobs .
'' there really was this covert operation going on,'' mr. owen said. mr. wichmann decided they needed some outside help, so he called dr. eustis, who referred him to robert buechner, a childhood basketball buddy and cincinnati lawyer .
the lawyer was intrigued with their idea. he helped them write an anonymous bid and began introducing them to venture capitalists, bankers and accountants .
during their lunch breaks and before and after work, mr. wichmann and mr. owen would meet with potential backers. they decided to wear khakis and shirts, the unofficial procter & gamble uniform, to those meetings .
'' if you wear a suit at procter and gamble, that' s a sign you' re interviewing,'' mr. wichmann said.'' i didn' t want to tip my hand.''
after two months of sub rosa maneuvering they had to reveal that they were the anonymous bidders for oxydol at p. & g.' s demand. the men made a point of telling their respective bosses on the same day .
'' i actually had one of my bosses say,' rich, have you thought this through?'' mr. owen said.''' what happens if procter & gamble considers you a competitor?' i thought, i' ve got my family and my resume.''
they are trying hard, meantime, to establish their own identity, separate from procter & gamble .
their first trip back to p. & g. went well. former colleagues kept dropping by, curious how mr. owen and mr. wichmann were making out in what they call'' the real world.''
while they were getting ready to leave their meeting, mr. owen noticed a small green packet of oxydol on the shelf.'' you guys were supposed to turn over all of the product!'' he teased the p. & g. representative. she and the partners shared a laugh .
as he walked toward the elevator, mr. owen slipped the oxydol packet into his back pocket .
we’re interested in your feedback on this page. tell us what you think .
accessibility concerns? email us at accessibility @ urltoken. we would love to hear from you .
for inquiries related to this message please contact support. for sales inquiries, please visit urltoken
if you believe this to be in error, please confirm below that you are not a robot by clicking
i' m not a robot
below .
please make sure your browser supports javascript and cookies and that you are not blocking them from loading. for more information you can review the terms of service and cookie policy .
please sign in and use this article' s on page print button to print this article .
investment firm allied capital corp. is looking to sell its controlling stake in the company, according to sources .
the timing is better now for allied to sell some of its companies than it has been for a while, napoli added .
allied aims to sell its portfolio companies at a significant gain after it holds them for a period of time. it typically buys controlling equity stakes in firms that generate strong cash flow. it often holds its shares for five to 10 years before exiting, allied said on its web site .
wichmann also wouldn' t be surprised by a sale, given allied' s structure of getting its investment out of a firm after a while .
like any private company, anything is for sale at any point ,
wichmann said .
nothing is imminent that i know of, but allied has to sell at some point .
it received a windfall earlier this year when it sold cincinnati - based hillman cos. inc. that sale in march to equity firm code hennessy & simmons brought $ 510 million. sale proceeds to allied totaled $ 244. 3 million, according to the filing. it realized a net gain of $ 150 million. that was allied' s largest capital gain ever, it said .
hillman was one of allied' s largest investments. allied still holds $ 42. 3 million in hillman debt .
allied also has an investment in cbs personnel holdings inc. , a cincinnati - based temporary staffing service provider. allied provided $ 20 million in subordinated debt financing oct. 5 for cbs' acquisition of venturi partners .
© 2018 american city business journals. all rights reserved. use of and / or registration on any portion of this site constitutes acceptance of our user agreement (updated 5 / 24 / 18) and privacy policy and cookie statement (updated 5 / 24 / 18). the material on this site may not be reproduced, distributed, transmitted, cached or otherwise used, except with the prior written permission of american city business journals .
cleanfax provides cleaning and restoration professionals with information designed to help them manage and grow their businesses.
redox brands was a marketing company formed in 2000 by todd wichmann and richard owen , former executives with the multinational consumer products firm procter & gamble ( p&g ) . the company 's first product was oxydol brand purchased from p&g . p&g would continue manufacturing oxydol and provide back office support . redox had won out over private label companies in the purchase of oxydol . biz was purchased in an auction from p&g in the summer of 2000 . forbes estimated that oxydol was sold for $ 7 million and biz for greater than $ 40 million . in one year , oxydol sales were 800 % greater than when acquired . in march 2001 , allied capital made its first investment in redox and made an addition investment in august 2002 . in 2002 , wichmann left redox for another startup , healthpro brands . allied capital acquired chempro , inc. in march 2006 . allied then merged redox and chempro , inc. , with the resulting company being renamed cr brands . 
redox brands was a marketing company formed in 2000 by todd wichmann and richard owen, former executives with the multinational consumer products firm procter & gamble (p&g). the company's first product was oxydol brand purchased from p&g. p&g would continue manufacturing oxydol and provide back office support. redox had won out over private label companies in the purchase of oxydol. biz was purchased in an auction from p&g in the summer of 2000. forbes estimated that oxydol was sold for $ 7 million and biz for greater than $ 40 million. in one year, oxydol sales were 800% greater than when acquired. in march 2001, allied capital made its first investment in redox and made an addition investment in august 2002. in 2002, wichmann left redox for another startup, healthpro brands. allied capital acquired chempro, inc. in march 2006. allied then merged redox and chempro, inc., with the resulting company being renamed cr brands.
redox brands was a marketing company formed in 2000 by todd wichmann and richard owen, former executives with the multinational consumer products firm procter & gamble (p&g). the company's first product was oxydol brand purchased from p&g. p&g would continue manufacturing oxydol and provide back office support. redox had won out over private label companies in the purchase of oxydol. biz was purchased in an auction from p&g in the summer of 2000. forbes estimated that oxydol was sold for $ 7 million and biz for greater than $ 40 million. in one year, oxydol sales were 800% greater than when acquired. in march 2001, allied capital made its first investment in redox and made an addition investment in august 2002. in 2002, wichmann left redox for another startup, healthpro brands. allied capital acquired chempro, inc. in march 2006. allied then merged redox and chempro, inc., with the resulting company being renamed cr brands.