04.04.23
In December 2022, sources claimed that Brazilian personal care cosmetics group Natura &Co was working with the Bank of America Corp and Morgan Stanley in order to sell a minority stake in its Aesop Brand, an Australian luxury beauty brand.
At the time, the process was still in initial stages of consultation and no decision had yet been made.
Then, in January, we reported that Aesop was at the center of a $2 billion bidding war between global beauty companies LVMH and L’Oréal.
Yesterday, L’Oréal won out and signed an agreement with Natura &Co to acquire Aesop in a transaction that values the beauty brand at $2.525 billion.
“I am very excited to welcome Aesop and its teams to the L’Oréal Groupe family,” said Nicolas Hieronimus, Chief Executive Officer of L’Oréal Groupe. “Aesop is the epitome of avant-garde beauty, whose products are not only made with great care and exceptional attention to detail; they are a superb combination of urbanity, hedonism and undeniable luxury. Aesop taps into all of today’s ascending currents and L’Oréal will contribute to unleash its massive growth potential, notably in China and Travel retail.”
The closing is subject to certain regulatory approvals and other customary conditions.
Aesop currently operates around 400 points of sale across the Americas, Europe, Australia, New Zealand, and Asia, with a nascent footprint in China where the first store opened in 2022.
The brand posted sales of $537 million in 2022.
She says this investment will facilitate further global expansion, particularly within China where the brand opened a store in 2022, extending the brand’s proposition to more potential customers who are attracted by its formulations and aesthetic.
Commenting on the acquisition, Cyril Chapuy, President of L’Oréal Luxe, added, “We have great confidence that Aesop will join the L’Oréal Luxe Billionaire brands club and therefore contribute significantly to the growth of the Division in the years to come.”
Moving forward, Natura &Co will sharpen its focus on strategic priorities, notably its investment plan in Latin America. It will also concentrate on continuing to improve The Body Shop’s business and refocusing Avon International’s footprint.
Recently, the Brazilian cosmetics giant posted a resilient performance in the fourth quarter, with sales growth in constant currency and continued progress in cash conversion, in line with its strategic priority.
At the time, the process was still in initial stages of consultation and no decision had yet been made.
Then, in January, we reported that Aesop was at the center of a $2 billion bidding war between global beauty companies LVMH and L’Oréal.
Yesterday, L’Oréal won out and signed an agreement with Natura &Co to acquire Aesop in a transaction that values the beauty brand at $2.525 billion.
“I am very excited to welcome Aesop and its teams to the L’Oréal Groupe family,” said Nicolas Hieronimus, Chief Executive Officer of L’Oréal Groupe. “Aesop is the epitome of avant-garde beauty, whose products are not only made with great care and exceptional attention to detail; they are a superb combination of urbanity, hedonism and undeniable luxury. Aesop taps into all of today’s ascending currents and L’Oréal will contribute to unleash its massive growth potential, notably in China and Travel retail.”
The closing is subject to certain regulatory approvals and other customary conditions.
About Aesop’s Operations
Created in 1987, Aesop is renowned for its skin, hair and body products. With its signature amber packaging, plant-based ingredients, sustainable vegan formulations, and its bespoke customer service, Aesop will join the likes of Lancôme and Kiehl’s within L’Oréal’s Luxe division. Aesop’s clean aesthetic resonates with Gen Z and Millennial consumers and although its products have a high price tag, it has broad appeal that enabled it to launch in various premium retailers.Aesop currently operates around 400 points of sale across the Americas, Europe, Australia, New Zealand, and Asia, with a nascent footprint in China where the first store opened in 2022.
The brand posted sales of $537 million in 2022.
Strong Potential for Global Expansion
“L’Oréal stands to benefit quickly from Aesop’s cult following, strong brand identity and reputation,” explained Lia Neophytou, Lead Analyst of Health & Hygiene at GlobalData.She says this investment will facilitate further global expansion, particularly within China where the brand opened a store in 2022, extending the brand’s proposition to more potential customers who are attracted by its formulations and aesthetic.
Commenting on the acquisition, Cyril Chapuy, President of L’Oréal Luxe, added, “We have great confidence that Aesop will join the L’Oréal Luxe Billionaire brands club and therefore contribute significantly to the growth of the Division in the years to come.”
Natura &Co to Concentrate on The Body Shop and Avon International
Meanwhile, Fábio Barbosa, Chief Executive Officer of Natura &Co says the divestment of Aesop “marks a new development cycle for Natura &Co.”Moving forward, Natura &Co will sharpen its focus on strategic priorities, notably its investment plan in Latin America. It will also concentrate on continuing to improve The Body Shop’s business and refocusing Avon International’s footprint.
Recently, the Brazilian cosmetics giant posted a resilient performance in the fourth quarter, with sales growth in constant currency and continued progress in cash conversion, in line with its strategic priority.
