French cosmetics firm L’Oréal will buy Australian cosmetics brand Aesop from Brazil’s Natura & Co for $2.5 billion (CZK 53.7 billion). L’Oréal will strengthen its luxury cosmetics portfolio and expand its activities abroad, Reuters reported today. It is the biggest acquisition to date for the French company, which owns brands such as Maybelline and Lancôme, according to data from Dealogic. The Brazilian firm, which owns the Avon and The Body Shot brands, will be helped by the deal from heavy debt and the impact of falling margins.
Aesop
Aesop is Natura’s most profitable brand, operating nearly 400 stores. Last year, the company increased revenue by 21 percent to $537 million and saw double-digit growth in all regions. It has also entered the Chinese market, where performance has exceeded expectations, the company said.
“Aesop is taking advantage of all the trends that are currently on the rise, and L’Oreal will contribute to unlocking its huge growth potential, especially in China and travel retail,” L’Oreal CEO Nicolas Hieronimus said in a statement.
A well-known company
The French cosmetics group is known for buying up emerging brands and amplifying their reach through its global distribution capabilities, said analyst Ian Simpson of Barclays. He estimated that Aesop’s share of L’Oréal’s so-called organic sales will be about 1.2 percent this year. Organic sales do not include the impact of acquisitions or exchange rate changes.
The transaction is expected to be completed in the third quarter of this year, subject to regulatory approval. The Aesop brand was founded in 1987 and offers skin, hair and body care products.
Source: CTK
