Investor Group, Management and Distributors Acquire Herbalife

An investor group led by private equity firms Whitney & Co., LLC and Golden Gate Capital, Inc. in partnership with Herbalife distributors and senior management, today announced it has completed the acquisition of Herbalife International, Inc.

“Whitney and Golden Gate are excited and honored to partner with Herbalife distributors and management. Together we will continue to pursue Mark Hughes’ important vision of changing the health and nutritional habits of the world,” said Peter M. Castleman, the new chairman of the board of Herbalife and the chairman and managing partner of Whitney & Co., LLC. “We believe that Herbalife is poised to build upon its leadership position in the wellness industry and benefit from the demographic and societal trends driving health and nutrition in our society today.”

Founded in 1980 by visionary Mark Hughes who originally started distributing Herbalife products out of the trunk of his car, Herbalife has emerged as a global leader in the weight management and nutrition industries. Over its 22-year history, Herbalife has expanded its operations from one to 54 countries. Herbalife has over one million distributors who retail the company’s products, and in 2001 Herbalife generated gross revenue of $1.7 billion. Since the sudden death of Mark Hughes in May of 2000, Herbalife’s ownership has been uncertain.

“This partnership will allow Herbalife to open a new chapter of success with a solid financial base, greater emphasis on new, best-in-class products, and more effective management of the business,” said Jesse Rogers, managing director of Golden Gate Capital. “The consistency and focus we will bring to the situation, combined with the benefits from distributor ownership, will go a long way towards realizing Herbalife’s potential.”

The investor group will finance the acquisition of Herbalife with $176 million of equity capital, and Herbalife’s distributors and senior management will invest alongside Whitney and Golden Gate.