Consumer products giant Unilever is to buy California-based Dollar Shave Club, an online razor delivery subscription business that has 3.2 million members.

Terms of the transaction were not officially disclosed, but sources say the FMCG giant is paying the razor business US$1 billion in cash.

“Dollar Shave Club is an innovative and disruptive male grooming brand with incredibly deep connections to its diverse and highly engaged consumers,” said Kees Kruythoff, president of Unilever North America.

“In addition to its unique consumer and data insights, Dollar Shave Club is the category leader in its direct-to-consumer space. We plan to leverage the global strength of Unilever to support Dollar Shave Club in achieving its full potential in terms of offering and reach.”

Michael Dubin, founder or Dollar Shave Club, will continue to serve as its CEO.

“We have long admired Unilever’s purpose-driven business leadership and its category expertise is unmatched,” said Dubin. “We are excited to be part of the family.”

Subject to regulatory approval, the transaction is expected to close during the third quarter.