L'Oreal Buys Aesop for $2.25B đź’°

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CPG WIRE
April 04, 2023

GM and Happy Tuesday, folks. Here’s what we’re covering this morning:

  • L’Oreal spends big on Aesop đź’°

  • Lord Sugar sells stake in Tropic Skincare 🌴

  • Authentic buys Boardriders 🏄‍♀️

  • KITH x Oru Kayak collab 🔥

  • Ding Dong Dim Sum scores funding 🍜

L’Oreal Buys Aesop for $2.25B 💰

L’Oreal has won the bidding war for Aesop. The French cosmetics giant will pay $2.25B to acquire Aesop, the luxury hair, skin, and body care brand that was founded in Melbourne in 1987, and purchased by Brazil’s Natura & Co in 2013.

L’Oreal beat out a number of deep-pocketed competitors for the prize, including LVMH, L’Occitane Group, Shiseido, and CVC Capital Partners.

Aesop will join a stable of premium brands in L’Oreal’s Luxe Division, which is home to Kiehl’s, Lancome, Yves Saint Laurent, Youth To The People, and many others.

This is no doubt a big swing for L’Oreal, but one that’s likely to pay off for a few different reasons.

First, Aesop has stood the test of time. Though only founded in 1987, the brand has longevity on its side. It’s not exactly Louis Vuitton, founded in 1854, but it has been around considerably longer than many of its peers.

Second, despite being over thirty years old, Aesop is still growing at a rapid clip. In Q3 of last year, Aesop's sales jumped 21.5%. In countries like Japan & South Korea, sales increased over 50%. Additionally, they opened 25 new stores in premium markets like Barcelona, Edinburgh, Hong Kong, and Seoul. Their stores are impressive too.

In short, Aesop is that rare established brand that’s still growing fast.

More from WWD on the transaction here.

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Lord Sugar Sells Stake in Tropic Skincare 🌴

Lord Sugar AKA Alan Michael Sugar, a London-based business magnate, has made a small fortune after selling his 50% stake in Tropic Skincare.

Officially incorporated in 2011 but launched in 2004 by Susan Ma, Tropic Skincare sells a variety of natural & cruelty-free hair, skin, and body care products.

Tropic Skincare landed on Lord Sugar’s radar after appearing on season 7 of The Apprentice. Though the company finished third in the television competition, Lord Sugar invested £200K for 50% of the company.

Sugar’s investment has been an incredibly fruitful one. In 2020, Lord Sugar & Susan Ma split a £10m dividend, and in 2019 they split a £2m dividend.

The company has grown considerably since Lord Sugar first invested. In 2021, the company reported revenue of ÂŁ90.6m and EBITDA of ÂŁ10.5m.

If we use a conservative 12x EBITDA multiple, we can confidently assume Lord Sugar made upwards of ÂŁ50m on the transaction. Not too bad for a ÂŁ200K investment made 12 years ago.

Deals đź’°

Mergers & Acquisitions 

  • Authentic Brands Group (ABG) agreed to acquire Boardriders for an undisclosed sum. Boardriders owns a number of action sports brands like Quicksilver, Billabong, Roxy, and DC Shoes. Axios

  • Luxury giant LVMH agreed to sell Italian handmade jewelry brand Vendorafa to Genoa-based Gismondi 1754. WWD

  • Indian distiller Tilaknagar Industries acquired a 10% stake in Spaceman Spirits Lab, a gin producer. Tilaknagar produces brandies, whiskies, and liqueurs. Just Drinks

  • Marquee Brands — a portfolio of apparel brands like Ben Sherman, BCBGMAXAZRIA, Bruno Magli, and others — is in the mix to possibly acquire the iconic Hunter Boots. Fashion Network

Fundraising

  • London-based Ding Dong Dim Sum secured six figures in funding from the Greater London Investment Fund (GLIF). Ding Dong launched in 2021 and sells dim sum meal kits online. The Grocer

  • FitFlop, a UK-based wellness footwear brand, secured $30m in debt as the company looks to grow its global presence. Another wellness footwear brand, Oofos, raised funding from the likes of Derek Carr & Alex Smith last week. The Industry

What’s New 🤩

Apparel, Cosmetics, and Wellness

  • H&M Beauty is opening its first-ever flagship stores in Oslo, Norway. The stores will feature cocktail bars and sell a variety of beauty brands like Anastasia Beverly Hills, Monday Haircare, and Patchology. Beauty Packaging

  • Clean beauty retailer Credo Beauty opened a concept store in Larchmont Village, Los Angeles. BeautyMatter

  • KITH collaborated with Oru Kayak on a stunning kayak. Twitter

  • KITH also partnered with outdoor brand Columbia on a fishing-inspired collection. PAUSE

  • Gummy supplement brand Goli introduced a new product — Beets Cardio. Target

Food, Beverage, and Alcohol

  • Tequila brand Patron unveiled a new limited edition line of smoky tequilas. The Spirits Business

  • Singapore-based Oatside collaborated with Malaysia-based Coffeeboy Club on a Double Choco-Oat beverage. Love the packaging. Instagram

  • Coffee & oat milk brand Minor Figures opened a very cool pop-up cafe in Sydney. BeanScene

  • Coors Whiskey Co., a subsidiary of Molson Coors, launched a new whiskey brand — Barmen 1873 Bourbon. Food Dive

  • Global spirits player Campari Group will spend $161m on a new Wild Turkey distillery in Kentucky. Fred Minnick

  • Prebiotic soda brand Poppi launched a new flavor, Grape. Poppi

  • Tip Top Proper Cocktails launched a RTD gin martini. BevNET

Data 🖥️

  • Une Femme Wines is on pace to sell 200,000 cases this year. PR Newswire

  • 2022 wasn’t a great year for biltong brand Stryve. FY sales dropped slightly to $29.9m from $30.1m the prior year. They also posted a net loss of $33.1m. GlobeNewswire

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