According to the Financial Times, Advent International (Advent) has signed a definitive agreement with Shiseido Americas to acquire bareMinerals, BUXOM, and Laura Mercier in a deal worth $700 million, two thirds lower than the asking price for the assets.
WHO: Launched in 1995, bareMinerals is the leader in mineral-based cosmetics and is considered the creator of "clean beauty" and "makeup so pure and clean you can sleep in it."
Buxom, created in 2007, is a color cosmetics brand focused on "going big, being bold, and feeling sexy." It is ranked among the top five U.S. brands across various lip categories.
Prestige makeup brand Laura Mercier was founded in 1996 and pioneered the natural "flawless face" category.
Shiseido Americas Corporation is a subsidiary of Tokyo-based Shiseido Company, Limited, a leading global beauty company. Led by President and CEO Ron Gee, Shiseido Americas' portfolio of prestige beauty brands includes BareMinerals, Buxom, Clé de Peau Beauté, Drunk Elephant, Laura Mercier, NARS, brand Shiseido and several prestige fragrance brands including Issey Miyake, Narciso Rodriguez and Tory Burch. Shiseido Americas is headquartered in New York City and employs more than 2,500 individuals in the United States, Canada, and Latin America.
Founded in 1984, Advent International is one of the largest and most experienced global private equity investors. The firm has invested in over 380 private equity investments across 42 countries, and as of March 31, 2021, had $75 billion in assets under management. The firm focuses on investments in five core sectors, including business and financial services; health care; industrial; retail, consumer and leisure; and technology.
WHY: Shisedo's makeup brands have been struggling and divesting these assets would allow the company to focus on skincare. In a statement earlier this year By 2023, Masahiko Uotani, president and CEO of Shiseido Grou Uotani said 80% of all sales should come from skin care currently about 60% of Shiseido's sales come from the category. In the last year Shiseido has also sold off its personal care business to CVC for $1.5 billion and ended its licensing contract with the fragrance business of Dolce & Gabbana, the Italian luxury brand.
IN THEIR OWN WORDS: We are strong believers in the bareMinerals, Buxom, and Laura Mercier brands," said Tricia Glynn, a Managing Director at Advent. "They are clear leaders in prestige beauty and are widely recognized for their quality, authenticity, and innovation, with differentiated products and devoted customers. We are excited to partner with Pascal as CEO of the new company to accelerate the growth of these brands by continuing to develop innovative products, expanding into new categories and geographies, and enhancing digital engagement with customers."
“We have been proud stewards of bareMinerals, BUXOM, and Laura Mercier, and we believe Advent is the right partner to guide these incredible brands into their next chapter," said Ron Gee, President and Chief Executive Officer of Shiseido Americas and Global M&A Leader. "This transaction will infuse bareMinerals, BUXOM, and Laura Mercier with the resources and support needed for the brands and their talented teams to continue to grow.”
Masahiko Uotani, president and CEO of Shiseido Group added, "While BareMinerals, Buxom and Laura Mercier have been a core part of our portfolio and have benefitted from Shiseido's stewardship to date, we believe Advent is uniquely positioned to continue supporting all three brands alongside their talented teams moving forward."
Horan I added that he's confident in the company's remaining brands, including Shiseido, Clé de Peau Beauté, NARS, Drunk Elephant and the fragrance brands. "We remain focused on making strategic investments across the portfolio and exploring other potential opportunities that fit into our premium skin beauty and global growth objectives," he said.
“I'm honored to be part of the team that will guide the future of bareMinerals, BUXOM, and Laura Mercier," said Pascal Houdayer who will serve as CEO. "We believe these brands have significant runway for growth, particularly as we see the large and growing color cosmetics market benefitting from secular tailwinds. I look forward to helping expand these brands across new products, channels, and regions, while enabling the new company to realize its full potential.”
- AI Beauty Holdings Ltd, a newly-formed affiliate of private equity investment firm Advent International, will acquire BareMinerals, Laura Mercier, Buxom from Shisedo America. Terms of the transaction were not disclosed but it was reported the deal was $700 million, two thirds lower than the asking price.
- Pascal Houdayer will serve as Chief Executive Officer of the standalone business. Advent Operating Partner Janet Gurwitch, founder and former CEO of Laura Mercier, advised Advent on the transaction and will continue to advise the firm and the new company.
- Shiseido acquired BareMinerals taking it private in 2010 for $1.7 billion and bought Laura Mercier and Buxom in 2016 for $248 million.
- Upon closing, the newly formed company, AI Beauty Holdings Ltd., will complete the acquisition of the three brands and the company will be renamed.
- Jefferies LLC is serving as financial advisor, and Weil, Gotshal & Manges LLP is acting as legal counsel to Advent. Perella Weinberg Partners is serving as financial advisor, and Morgan, Lewis & Bockius LLP is acting as legal counsel to Shiseido Americas.
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