Japan’s Shiseido sells make-up brands for $700m to focus on skincare
Updated
Japan’s cosmetics and beauty group Shiseido on Thursday announced sale of three make-up brands to US-based private equity firm Advent International for USD700m as the company looks to focus on its core skincare portfolio.
Tokyo-listed shares in the company extended gains on Friday to rise by 1% to JPY7,026.
Shiseido will sell its make-up brands bareMinerals, BUXOM, and Laura Mercier in order to “optimise our portfolio” and “focus on profitability,” the company said.
Interim net loss reported
Earlier in August, the company posted a net loss of JPY17.3bn (USD157.3m) for the first six months of 2021 compared to JPY21.4bn a year ago.
The Tokyo-headquartered company had said that while the skincare market was growing, the base and colour make-up was shrinking in the local market due to COVID-19-related issues.
“The Shiseido Group is shifting to a new business structure, with skin beauty positioned as its core category,” the company said on Thursday.
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Focus on skincare
Proceeds from the sale will be used for development of key brands and acquisitions in the skin beauty category and for digital transformation, Shiseido added.
The company said it will be paid USD350m in cash upon closing of the asset sale, which is expected by the end of this year. The remainder of the USD700m will be paid as deferred payment in the form of a credit extension by Advent International to the company, payable on the seventh anniversary of the deal closing.
For full-year 2020, the three brands posted JPY44.8bn in combined sales, which amounted to about 5% of the Shiseido’s top line.
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