It may seem a long and somewhat implausible road from the halls of academia to the chairman’s seat of a company traded on Wall Street, but it took Leroy Keith just a little over a year to make the trip. In August 1995, the former president of Atlanta’s esteemed Morehouse College executed a $96 million leveraged buyout of Savannah, Georgia- based Carson Inc., makers of Dark & Lovely, Excelle, Magic Shave, Beautiful Beginnings and Dark & Natural products.
Carson is one of the top producers of ethnic hair care products in the country, successfully competing against such companies as Soft Sheen, Luster and large general market companies like Revlon and Clairol. It currently manufactures more than 70 products under five principal brand names, including the very popular Dark & Lovely line of hair coloring products and relaxers.
In spearheading the buyout, Keith became Carson’s chairman and CEO–the first African American to sit at the helm of the company, whose history dates back to 1901. More impressive, however, is that in less than two years, Keith and his management team have set in motion an aggressive growth plan, which includes global expansion, acquisitions an entree into the personal care and professional salon products markets. In addition, he has taken the company public on both U.S. and South African stock markets. According to Brad Creswell, Carson’s former chief financial officer, since Keith’s takeover the company’s worth has grown from $80 million as a privately held concern to $230 million as a publicly traded company.
But how was Keith, a man with modest business management experience (he once owned 17 Pizza Hut franchises in South Carolina, but was not involved in their day-to-day management) able to successfully captain such an ambitious project? The wheels were set in motion in August 1994, when the Minis family, who then owned Carson and were looking to sell it, invited bids for the company through a coordinator they had appointed.
“I knew from the very beginning that Carson was an attractive company,” says Keith, who also gained insight into the company’s great potential as a member of Carson’s board. “When the opportunity came to purchase it, I called on the people who I knew had experience in putting these kind of deals together.” One of the first people Keith reached out to was venture capitalist Vincent Wasik, a principal in the Westport, Connecticut-based firm Morningside Capital Group L.L.C. Keith and Wasik met when both were serving on the board of One To One: The National Mentoring Project, an organization based in Washington, D.C., that works with at-risk youth.
Whenever Keith would speak at various board meetings, he’d talk about the importance of education, and stress the importance of economic empowerment among the black community, says Wasik, who is white. “We began to talk and I really felt he had an understanding of how people from different backgrounds can work together to generate wealth.” The two began eyeing a number of businesses with the intention of doing acquisition deals together.
According to John