French cosmetics giant L’Oreal has purchased the Australian luxury brand Aesop from Brazilian company Natura & Co for an enterprise value of $2.53 billion, the firms have announced. This is L’Oreal’s largest brand acquisition to date, according to data from Dealogic, and the third-largest purchase of an Australian consumer products company.
Aesop has grown significantly in recent years, with its sales hitting $537 million in 2022 and double-digit growth in all regions. The brand is well-established in Australia and has recently entered the Chinese market with positive results. This acquisition provides a business opportunity for L’Oreal to expand in the luxury cosmetics sector and for Natura & Co, this sale could financially support the optimization of its business and deleverage its debts.
L’Oreal is a global leader in cosmetics, skincare and hair care products. Founded in 1907, the company has grown over the years and present in 140 countries. Sitting at the helm of this cosmetics giant is Nicolas Hieronimus who is the CEO of the company and believes that this acquisition of Aesop will help to grow even further its presence in the luxury cosmetics market.
Fabio Barbosa is the new Chief Executive Officer appointed at Natura & Co. Facing shrinking margins and heavy debts, Natura decided to shake up its organizational structure, with former CEO and Executive Chair Roberto Marques stepping down in June 2020. This allowed for Barbosa to take the lead and be present for the sale of Aesop, one of its most profitable brands, to L’Oreal.
This acquisition is still subject to regulatory approvals, with the payment to be made in cash once the closing date noted for third quarter of 2023 is reached. With this move, L’Oreal’s market presence in the luxury cosmetics sector is expected to reach new heights, whilst Natura can make strides towards long-term financial stability.