French cosmetics group L’Oreal will acquire a majority stake in India’s Innovist, it said on Thursday, as it looks to step up its share of one of the world’s fastest-growing markets.
The deal, which includes rights to buy out the minority shareholders in full, adds local brands, including haircare range Bare Anatomy and Chemist at Play skincare, to its portfolio.
Financial details were not disclosed.
L’Oreal‘s acquisition of Innovist marks its first purchase of an Indian company in nearly 13 years, since it bought Mumbai-based Cheryl’s Cosmeceuticals in September 2013.
“Our investment in this innovative Indian startup is a clear testament to our unwavering commitment to expanding L’Oreal‘s footprint in India,” said CEO Nicolas Hieronimus in a statement.
Hieronimus said earlier this year that the company was “not meeting expectations” in India, which is seeing rapid growth driven by young, affluent, social-media-savvy shoppers with rising disposable income.
The company, which makes about 1% of its turnover in India, had high single-digit growth in the country last year, but “did not gain a lot of market share, if any”, Hieronimus told investors after reporting annual results.
It recently brought in a new CEO to boost its performance.
L’Oreal said Innovist is one of the fastest-growing “science-led and digital-first” personal care companies in India, based on clean formulations and transparent ingredients.
The deal is expected to close in the next few months, subject to regulatory approvals, the company said. It added that the founders and minority shareholders will continue to operate the business in collaboration with L’Oréal India. The brand’s portfolio will join L’Oréal’s Consumer Products division.
Reuters
