Unilever buys majority stake in Italian natural beauty and well-being brand; Marc Anthony hair and beauty business raises US$182 million in IPO; Space NK owner hires Goldman Sachs for potential sale; and Korean beauty exports increase 36.7 per cent in first half of 2018.
Unilever buys majority stake in Italian natural beauty and well-being brand
Unilever has been cherry-picking its way across the hottest beauty and personal care categories for the past three years. The multinational has spent an estimated US$10.25 billion on 18 buyout sales since 2015, including Dermalogica, REN, Murad, Dollar Shave Club and Korean skincare maker, Carver Korea – the biggest deal of all at US$3.1 billion. A smart strategy that's centred on accessing fast-growing categories such as prestige and natural beauty and sales channels that Unilever's magic brands, including Dove, Sunsilk and Rexona don't operate in.
Unilever debuted Love Beauty Planet, a natural range of haircare and body products, in the US last December in a bid to target Millennials. The multinational has extended its presence in the natural sector by taking a 75 per cent majority stake in Equilibra. The Italian personal care and well-being company was founded in 1987 by Franco Bianco and its products cover many categories, including baby care, specialist skincare, trichology-based haircare, natural oils and nutritional supplements.
The use of plant-based ingredients such as aloe vera, shea, argan and almond and its Italian heritage are Equilibra's major points-of-difference. The company will continue to operate as a standalone business but Unilever has plans to go global in the near future.
Marc Anthony hair and beauty business raises US$182 million in IPO
It's been a busy two years for MAV Beauty Brands, the haircare and beauty company founded by Canadian hairstylist Marc Anthony Venere in the mid-1990s. In 2016, US private equity firm TA Associates bought the core professional hair care brand for US$174 million. Sold in 25 countries around the world, including Australia through Priceline and Coles, MAV took a further step to achieving its goal of becoming Canada's leading home-grown beauty player with the buyout of Cake Beauty in February this year.
Venere's trend-setting hair salons in Canada and the US have attracted a celebrity clientele, including Hilary Swank, Eva Longoria, Freida Pinto and Justin Bieber. In May, the company announced it would launch an IPO (Initial Public Offering) to raise investment capital of up to US$196 million. The final figure was US$182 million which will be used to pay down debt before embarking on a global expansion strategy for both Marc Anthony haircare and Cake Beauty.
Space NK owner hires Goldman Sachs for potential sale
Manzanita Capital was founded in 2001 and one of its major investors is Bill Fisher, the son of Don and Doris Fisher who founded the Gap clothing empire. A year later, the private equity firm bought Space NK, the upmarket British beauty retailer founded by Nicky Kinnaird in the late 1990s. Over the last decade, Manzanita helped to propel Space NK from a London to a national phenomenon in the UK with 60 stores nationwide and 29 stores in the US, including concept boutiques in Bloomingdales and Nordstrom.
Manzanita also bought Diptyque in 2005 and a majority stake in Byredo perfumes in 2013. Other major names in the company's portfolio include Kevyn Aucoin, Malin + Goetz, Apothecary, Eve Lom and Lipstick Queen. According to a report in WWD, Manzanita has hired Goldman Sachs to scout for potential buyers not only for Space NK but also Lipstick Queen, Kevyn Aucoin and Eve Lom.
Korean beauty exports increase 36.7 per cent in first half of 2018
L'Oréal finalised the acquisition of Nanda last week and the buyout of the South Korean fashion and beauty brand which pulled in AUD$200.48 million in 2017 is looking like a sure bet. According to new data from the Korea Customs Service, K-Beauty exports climbed to US$2.06 billion from January through May – an increase of 36.7 per cent over the same period 12 months earlier. In 2017, Korean beauty exports hit a record high of US$3.92 billion and there's still most of the world left to conquer.
The bulk of exports went to mainland China (37.4%) and Hong Kong ( 24.6%). In spite of the avalanche of media coverage in the US, the American market accounted for only 9.4 per cent of K-Beauty exports, followed by Japan (5%) and Thailand (3.4%). The fastest growth occurred in Vietnam, where exports hit US$123 million last year – double the amount of 2016. Skincare accounts for 50.7 per cent of Korea's beauty exports, followed by makeup at 9.5 per cent. It's a two-way street, though. South Korea imported US$1.17 billion worth of beauty and personal care products in 2017.
Snippets from the wires
- The Asia/Pacific region might be the top growth market for luxury and prestige beauty brands, but the US remains a goldmine. Chanel, which has leased its NYC HQ for the past 25 years, has bought the premises – 7 floors of a 17 storey building in Midtown Manhattan – for US$81.5 million and plans to spend US$3.8 million on renovations.
- Glamglow, the upmarket skincare brand famous for its face masks, was acquired by Estée Lauder in late 2016. So it's not surprising that the brand – sold in Mecca in Australia – is branching into makeup with the launch of a highlighter palette. Infused with hyaluronic acid and Brazilian golden clay, added skincare benefits are a major selling point.
- Leonard Lauder, Chairman Emeritus of the Estée Lauder Companies, will be the 2018 recipient of the John B. Fairchild Award. Named after the former Chairman and editorial director of fashion for WWD, Mr Lauder is only the third winner of the prestigious award. The inaugural 2016 honour went to Ralph Lauren, followed by Karl Lagerfeld.
- Last week we reported that Tengram Capital has acquired indie beauty brand, Lime Crime. The private equity firm is also the major shareholder of Differential Brands Group, which has bought Hong Kong-based Global Brands North American fashion licensing business for US$1.38 billion in cash. The major licenses included in the deal are Disney, Calvin Klein, Under Armour and Michael Kors.
