Physicians Formula Holdings Inc. has agreed to be acquired by Swander Pace Capital for $65 million.

Physicians Formula Holdings, Swander Pace Capital, cosmetics, skin care, mass-market prestige, masstige, beauty care, Ingrid Jackel, Mo Stout

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Physicians Formula to go private in buyout

August 15th, 2012

AZUSA, Calif. – Physicians Formula Holdings Inc. has agreed to be acquired by Swander Pace Capital for $65 million.

The cosmetics and skin care company said Wednesday that under the deal, affiliates of Swander Pace will buy all outstanding shares of Physicians Formula common stock for $4.25 per share in cash, a premium of about 15% over the closing stock price on Aug. 14 and a premium of 21% over the one-month volume-weighted average price of $3.50 per share.

The transaction is slated to close later this year. Once completed, Physicians Formula will be privately owned and will continue to be operated by its current management team and employees.

"Our board of directors, following a thorough analysis by its Special Committee, has determined that this transaction offers the best value for our stockholders," stated Ingrid Jackel, Physicians Formula chairman and chief executive officer. "We are pleased that Swander Pace has agreed to purchase our company. The firm has a record of success in acquiring and operating companies in the consumer space, and we believe they will add value to our business as we continue to successfully execute our growth initiatives."

A mass-market prestige or "masstige" beauty care company, Physicians Formula was founded in 1937 by Dr. Frank Crandall. It will remain based in Azusa, Calif.

"The acquisition of Physicians Formula reinforces Swander Pace's investment focus on lower middle-market consumer products industry companies," commented Swander Pace managing director Mo Stout. "Physicians Formula is a pioneer in the cosmetics industry, and we are committed to working with its management team on this next stage of growth and innovation for the company."

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