Shaklee Corporation
Encyclopedia
Shaklee Corporation is a privately held manufacturer and distributor of nutritional supplements, weight-management products, beauty products, and household products. The company is based in Pleasanton, California
with operations in Canada, Japan, Malaysia, Mexico, Taiwan and China. The company sells its products through a multi-level marketing
network and claims a combined base of 750,000 "members" (customers) and distributors.
, created "Shaklee's Vitalized Minerals" in 1915 before the concept of vitamin
s was fully understood. In 1956, Dr. Shaklee founded the Shaklee Corporation with his two sons to manufacture nutritional supplements
.
Shaklee chose the relatively unknown multi-level marketing
business model to market his product.
Starting in 1960, Dr. Shaklee began marketing organic
, biodegradable
cleaning products. He continually emphasized "natural" and "environmentally friendly" in his marketing messages, ideas which were not common at the time.
in the late 1970s and was listed on the New York Stock Exchange
. The corporation began to diversify in November 1986 when it purchased the Bear Creek Corporation
, a direct marketing
company best known for its Harry and David Fruit-of-the-Month Club operation, from RJR Nabisco
for $123 million.
In February 1989 Shaklee sold its 78 percent interest in Shaklee Japan to the Yamanouchi Pharmaceutical Company
for $350 million, while maintaining its licensing agreement and continuing to collect royalty payments from the Japanese operations.
Then in March 1989, Shaklee Corporation received an unsolicited acquisition proposal
from a group led by Irwin L. Jacobs
, the Minneapolis financier
known also by his nickname "Irv the Liquidator". Analysts placed the leveraged buyout value of Shaklee at $35 a share
. The Jacobs group had been aggressively accumulating Shaklee shares, and disclosed it currently held a 14.98 percent stake in the San Francisco-based company. Shaklee immediately declared a special dividend
of $20 a share, seen as a poison pill
—a way to discourage takeover interest in Shaklee, though the company disputed that view. Shaklee's anti-takeover provisions come into play when an investor reaches 15 percent.
After a few tense weeks, during which time Jacobs increased his stake in Shaklee,
Shaklee Corporation announced it was being acquired by Yamanouchi Pharmaceutical for $28 a share in cash, or about $395 million. Yamanouchi's partnership with Shaklee in Japan helped make the transaction possible, and cast Yamanouchi as a "white knight"
in helping Shaklee fend off the hostile takeover bid by Jacobs.
Jacobs announced he would not challenge the Yamanouchi bid
and the deal with Yamanouchi was quickly finalized. Shaklee became a privately held company
.
In April 2004, Yamanouchi sold Shaklee Corporation to American billionaire Roger Barnett, managing partner of Activated Holdings LLC, for $310 million. Bear Creek and the Harry and David line was sold to Wasserstein Perella & Co.
for $260 million.
Barnett became the new CEO and Chairman of the Board of Shaklee Corporation. "Shaklee is the crown jewel of the network marketing industry," Barnett stated. "My dream is to build Shaklee into the number one company in the world in our field." Barnett went on to predict Shaklee would become the leading nutrition and natural personal care company in the world, generating $5 billion in annual revenues.
In 2008, CEO & Chairman of the Board Roger Barnett announced a new president of Shaklee International, Bradford Richardson.
Shaklee is committed to being green and is the first company in the world to obtain Climate Neutral™ certification to totally offset their CO2 emissions, resulting in a net zero impact on the environment (http://www.shaklee.com/company_home.shtml).
in their Multivitamin and Multimineral Supplements Review of 38 of the leading multivitamin/multimineral products sold in the U.S. and Canada. The multivitamin passed ConsumerLab's test, which included testing of selected index elements, their ability to disintegrate in solution per United States Pharmacopeia
guidelines, lead contamination threshold set in California Proposition 65, and meeting U.S. Food and Drug Administration
(FDA) labeling requirements.
A landmark nutrition study published in the peer-reviewed Nutrition Journal (October 24, 2007) led by a Nobel Laureate in Nutrition compared users of Shaklee vitamins and supplements with users of leading multivitamins and people who took no vitamins or supplements over a 20 year period. The study showed Shaklee users "to have markedly better health as measured by higher blood levels of key nutrients, more optimal levels of key health biomarkers, and lower prevalence of diabetes and elevated blood pressure." As a group the Shaklee users "were 73% less likely to have diabetes and 39% less likely to have elevated blood pressure than non-users. Also, this group was less likely to have suboptimal blood nutrient concentrations, and more likely to have favorable levels of key biomarkers including serum homocysteine, C-reactive protein, high-density lipoprotein cholesterol, and triglycerides than either non-users or multivitamin/mineral users." (http://www.shaklee.com/NewsRelease07_102907.shtml ... http://www.nutritionj.com/content/6/1/30)
professional cycling team managed by Frank Scioscia. In its final year of existence (2000) Team Shaklee was the top-ranked UCI tier III team in the world and included United States Olympic Team members Jamie Carney, Jonas Carney, Adam Laurent, and Kent Bostick.
Pleasanton, California
Pleasanton is a city in Alameda County, California, incorporated in 1894. It is a suburb in the San Francisco Bay Area located about east of Oakland, and west of Livermore. The population was 70,285 at the 2010 census. In 2005 and 2007, Pleasanton was ranked the wealthiest middle-sized city in...
with operations in Canada, Japan, Malaysia, Mexico, Taiwan and China. The company sells its products through a multi-level marketing
Multi-level marketing
Multi-level marketing is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of others they recruit, creating a downline of distributors and a hierarchy of multiple levels of compensation...
network and claims a combined base of 750,000 "members" (customers) and distributors.
Founding
Dr. Forrest C. Shaklee, a San Francisco chiropractorChiropractic
Chiropractic is a health care profession concerned with the diagnosis, treatment and prevention of disorders of the neuromusculoskeletal system and the effects of these disorders on general health. It is generally categorized as complementary and alternative medicine...
, created "Shaklee's Vitalized Minerals" in 1915 before the concept of vitamin
Vitamin
A vitamin is an organic compound required as a nutrient in tiny amounts by an organism. In other words, an organic chemical compound is called a vitamin when it cannot be synthesized in sufficient quantities by an organism, and must be obtained from the diet. Thus, the term is conditional both on...
s was fully understood. In 1956, Dr. Shaklee founded the Shaklee Corporation with his two sons to manufacture nutritional supplements
Dietary supplement
A dietary supplement, also known as food supplement or nutritional supplement, is a preparation intended to supplement the diet and provide nutrients, such as vitamins, minerals, fiber, fatty acids, or amino acids, that may be missing or may not be consumed in sufficient quantities in a person's diet...
.
Shaklee chose the relatively unknown multi-level marketing
Multi-level marketing
Multi-level marketing is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of others they recruit, creating a downline of distributors and a hierarchy of multiple levels of compensation...
business model to market his product.
Starting in 1960, Dr. Shaklee began marketing organic
Organic matter
Organic matter is matter that has come from a once-living organism; is capable of decay, or the product of decay; or is composed of organic compounds...
, biodegradable
Biodegradation
Biodegradation or biotic degradation or biotic decomposition is the chemical dissolution of materials by bacteria or other biological means...
cleaning products. He continually emphasized "natural" and "environmentally friendly" in his marketing messages, ideas which were not common at the time.
Expansion, divestiture, changes of ownership
Shaklee Corporation was a publicly traded companyPublic company
This is not the same as a Government-owned corporation.A public company or publicly traded company is a limited liability company that offers its securities for sale to the general public, typically through a stock exchange, or through market makers operating in over the counter markets...
in the late 1970s and was listed on the New York Stock Exchange
New York Stock Exchange
The New York Stock Exchange is a stock exchange located at 11 Wall Street in Lower Manhattan, New York City, USA. It is by far the world's largest stock exchange by market capitalization of its listed companies at 13.39 trillion as of Dec 2010...
. The corporation began to diversify in November 1986 when it purchased the Bear Creek Corporation
Bear Creek Corporation
Harry & David is an American company that was founded in 1910, when Seattle hotelier Samuel Rosenberg purchased of pear orchards in Medford, Oregon. His sons, Harry and David, took the company over upon his death in 1914...
, a direct marketing
Direct marketing
Direct marketing is a channel-agnostic form of advertising that allows businesses and nonprofits to communicate straight to the customer, with advertising techniques such as mobile messaging, email, interactive consumer websites, online display ads, fliers, catalog distribution, promotional...
company best known for its Harry and David Fruit-of-the-Month Club operation, from RJR Nabisco
RJR Nabisco
RJR Nabisco, Inc., was an American conglomerate formed in 1985 by the merger of Nabisco Brands and R.J. Reynolds Tobacco Company. RJR Nabisco was purchased in 1988 by Kohlberg Kravis Roberts & Co...
for $123 million.
In February 1989 Shaklee sold its 78 percent interest in Shaklee Japan to the Yamanouchi Pharmaceutical Company
Astellas Pharma
is a Japanese pharmaceutical company, formed on 1 April 2005 from the merger of and .Astellas' franchise areas are urology, immunology , dermatology, cardiology, and infectious disease...
for $350 million, while maintaining its licensing agreement and continuing to collect royalty payments from the Japanese operations.
Then in March 1989, Shaklee Corporation received an unsolicited acquisition proposal
Takeover
In business, a takeover is the purchase of one company by another . In the UK, the term refers to the acquisition of a public company whose shares are listed on a stock exchange, in contrast to the acquisition of a private company.- Friendly takeovers :Before a bidder makes an offer for another...
from a group led by Irwin L. Jacobs
Irwin L. Jacobs
Irwin L Jacobs is an entrepreneur and the CEO of several large corporations, including Genmar Holdings, Inc. the worlds largest boat building company. He earned the nickname "Irv the Liquidator" for his aggressive business practices in the 1970s and early 1980s...
, the Minneapolis financier
Financier
Financier is a term for a person who handles typically large sums of money, usually involving money lending, financing projects, large-scale investing, or large-scale money management. The term is French, and derives from finance or payment...
known also by his nickname "Irv the Liquidator". Analysts placed the leveraged buyout value of Shaklee at $35 a share
Share (finance)
A joint stock company divides its capital into units of equal denomination. Each unit is called a share. These units are offered for sale to raise capital. This is termed as issuing shares. A person who buys share/shares of the company is called a shareholder, and by acquiring share or shares in...
. The Jacobs group had been aggressively accumulating Shaklee shares, and disclosed it currently held a 14.98 percent stake in the San Francisco-based company. Shaklee immediately declared a special dividend
Dividend
Dividends are payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders. When a corporation earns a profit or surplus, that money can be put to two uses: it can either be re-invested in the business , or it can be distributed to...
of $20 a share, seen as a poison pill
Poison pill
A shareholder rights plan, colloquially known as a "poison pill", or simply "the pill" is a type of defensive tactic used by a corporation's board of directors against a takeover...
—a way to discourage takeover interest in Shaklee, though the company disputed that view. Shaklee's anti-takeover provisions come into play when an investor reaches 15 percent.
After a few tense weeks, during which time Jacobs increased his stake in Shaklee,
Shaklee Corporation announced it was being acquired by Yamanouchi Pharmaceutical for $28 a share in cash, or about $395 million. Yamanouchi's partnership with Shaklee in Japan helped make the transaction possible, and cast Yamanouchi as a "white knight"
White knight (business)
In business, a white knight, or "friendly investor," may be a corporation or a person that intends to help another firm. There are many types of white knights...
in helping Shaklee fend off the hostile takeover bid by Jacobs.
Jacobs announced he would not challenge the Yamanouchi bid
and the deal with Yamanouchi was quickly finalized. Shaklee became a privately held company
Privately held company
A privately held company or close corporation is a business company owned either by non-governmental organizations or by a relatively small number of shareholders or company members which does not offer or trade its company stock to the general public on the stock market exchanges, but rather the...
.
In April 2004, Yamanouchi sold Shaklee Corporation to American billionaire Roger Barnett, managing partner of Activated Holdings LLC, for $310 million. Bear Creek and the Harry and David line was sold to Wasserstein Perella & Co.
Wasserstein Perella & Co.
Wasserstein Perella & Co. was an investment bank established by Bruce Wasserstein, Joseph R. Perella, Bill Lambert, and one other founder in 1988, former bankers at First Boston Corp., until its eventual sale to Dresdner Bank in 2000 for some $1.4 billion in stock...
for $260 million.
Barnett became the new CEO and Chairman of the Board of Shaklee Corporation. "Shaklee is the crown jewel of the network marketing industry," Barnett stated. "My dream is to build Shaklee into the number one company in the world in our field." Barnett went on to predict Shaklee would become the leading nutrition and natural personal care company in the world, generating $5 billion in annual revenues.
In 2008, CEO & Chairman of the Board Roger Barnett announced a new president of Shaklee International, Bradford Richardson.
Shaklee is committed to being green and is the first company in the world to obtain Climate Neutral™ certification to totally offset their CO2 emissions, resulting in a net zero impact on the environment (http://www.shaklee.com/company_home.shtml).
Reception
Shaklee's Scientifically Advanced Vita-Lea Iron Formula multivitamin was tested by ConsumerLab.comConsumerLab.com
ConsumerLab.com is a provider of independent test results and information to help consumers and healthcare professionals evaluate health, wellness, and nutrition products. ConsumerLab.com was founded in 1999. It is subscription fee based....
in their Multivitamin and Multimineral Supplements Review of 38 of the leading multivitamin/multimineral products sold in the U.S. and Canada. The multivitamin passed ConsumerLab's test, which included testing of selected index elements, their ability to disintegrate in solution per United States Pharmacopeia
United States Pharmacopeia
The United States Pharmacopeia is the official pharmacopeia of the United States, published dually with the National Formulary as the USP-NF. The United States Pharmacopeial Convention is the nonprofit organization that owns the trademark and copyright to the USP-NF and publishes it every year...
guidelines, lead contamination threshold set in California Proposition 65, and meeting U.S. Food and Drug Administration
Food and Drug Administration
The Food and Drug Administration is an agency of the United States Department of Health and Human Services, one of the United States federal executive departments...
(FDA) labeling requirements.
A landmark nutrition study published in the peer-reviewed Nutrition Journal (October 24, 2007) led by a Nobel Laureate in Nutrition compared users of Shaklee vitamins and supplements with users of leading multivitamins and people who took no vitamins or supplements over a 20 year period. The study showed Shaklee users "to have markedly better health as measured by higher blood levels of key nutrients, more optimal levels of key health biomarkers, and lower prevalence of diabetes and elevated blood pressure." As a group the Shaklee users "were 73% less likely to have diabetes and 39% less likely to have elevated blood pressure than non-users. Also, this group was less likely to have suboptimal blood nutrient concentrations, and more likely to have favorable levels of key biomarkers including serum homocysteine, C-reactive protein, high-density lipoprotein cholesterol, and triglycerides than either non-users or multivitamin/mineral users." (http://www.shaklee.com/NewsRelease07_102907.shtml ... http://www.nutritionj.com/content/6/1/30)
Cycling team
From 1988-2000 Shaklee was the title sponsor of an American based UCIUnion Cycliste Internationale
Union Cycliste Internationale is the world governing body for sports cycling and oversees international competitive cycling events. The UCI is based in Aigle, Switzerland....
professional cycling team managed by Frank Scioscia. In its final year of existence (2000) Team Shaklee was the top-ranked UCI tier III team in the world and included United States Olympic Team members Jamie Carney, Jonas Carney, Adam Laurent, and Kent Bostick.
NASA
Beginning in 1993, Shaklee started providing NASA with a customized rehydration beverage for use by Shuttle astronauts and its use continues today.Olympic athletes
Some of the athletes that use Shaklee products are: Craig Blanchette, Laurie Brandt, Kent Bostick, Eli Bremer, Sandra Gal, Bill Demong, Kris Freeman, Zach Krych, Adam Moore, Reilley Rankin, Jennifer Rodriguez, Carl Rundell, Roz Savage, Darin Shapiro, and Ashley Wagner.External links
- Corporate web site
- "Eco-Socialites Make Cleaning Green a Priority", New York Times, 22 April 2007
- "James Whittam, 49, President And Chief of Shaklee Companies", New York Times, 3 May 1999