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With a strengthened financial structure, Natura &Co to focus on strategic priorities
SÃO PAULO, April 3, 2023 /PRNewswire/ -- Natura &Co (NYSE – NTCO; B3 – NTCO3) announces that it has reached an agreement under which L'Oréal will acquire Aesop, opening a new chapter of the luxury beauty brand's growth story after 10 successful years under Natura &Co's stewardship.
Under the transaction, L'Oréal has signed an agreement to acquire Aesop for an enterprise value of US$ 2.525 bn. The transaction is still subject to customary regulatory approvals and is expected to close in Q3 2023.
With the transaction, Natura &Co will strengthen and deleverage its balance sheet, freeing up resources to focus on its strategic priorities, notably the integration in Latin America, as well as the further optimization of Avon International's footprint and the improvement of The Body Shop´s business.
Since becoming part of Natura &Co in 2012, Aesop has posted spectacular growth. Between 2012 and 2022, gross sales increased from US$28 million to US$537 million. The number of stores and counters increased from 52 to 395 as Aesop expanded its geographic footprint from 8 markets to 29. More recently, in 2022, Aesop opened its first physical stores in Mainland China, and significantly grew its fragrance category.
Fabio Barbosa, Chief Executive Officer of Natura &Co, declared: "The divestment of Aesop marks a new development cycle for Natura &Co. With a strengthened financial structure and a deleveraged balance sheet, Natura &Co, exercising strict financial discipline, will be able to sharpen its focus on its strategic priorities, notably our investment plan in Latin America. We will also be able to concentrate on continuing to improve The Body Shop's business and refocusing Avon International's footprint. We are proud of the remarkable success of the Aesop brand, and we are extremely grateful to all Aesop's associates, who contributed immensely not only to Aesop's success, but also to making Natura &Co what it is today. We are confident that Aesop's growth story will continue under the ownership of L'Oréal and wish Aesop continued success in this new chapter."
Nicolas Hieronimus, Chief Executive Officer of L'Oréal Groupe, said, "I am very excited to welcome Aesop and its teams to the L'Oréal Groupe family. 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."
Michael O'Keefe, CEO of Aesop, added: "This is an exciting day for Aesop. With the support of Natura &Co, over the past decade, we have built Aesop into an admirable global force in the luxury beauty space, with a powerful product proposition and a unique customer and retail experience. We now enter the next phase of our development and I'm confident that with L'Oréal's partnership we will be able to bring our exceptional skincare products to even more people and continue to expand our brand globally. We thank Natura &Co for its support and are greatly looking forward to working with L'Oréal to continue our development, building on our distinctive brand and heritage."
Morgan Stanley served as lead financial advisor, Bank of America as financial advisor, and Davis Polk & Wardwell as main legal advisor to Natura &Co.
Posted In: NTCO
