The Beauty Care sector finished off a record year with another strong quarter. While Q4’16 was down versus a record Q3’16, it finished 14% higher than Q4’15 and capped a fantastic year with more than 100 beauty care M&A deals, an increase of 20% over 2015.
In a year we previously deemed the “Year of the Strategic Beauty Care Buyer,” the trend continued with deals announced by Unilever, Coty and Estée Lauder. In addition, new beauty care strategic acquirers emerged with the formation of Glansaol and the entry of Edgewell Personal Care into the M&A mix. And if you thought 2016 was the end of the beauty care M&A hot streak—think again. 2017 is off to a red-hot start with acquisitions already announced by L’Oréal, Coty and High Ridge Brands.
Q4’16 Beauty Care M&A highlights include:
- Deal volume rose 14% in Q4’16 from Q4’15, but expectedly declined 14% from the record-high levels in Q3’16.
- Coming off the Dollar Shave Club and Seventh Generation deals in Q3’16, Unilever continued its acquisition run with the purchase of Living Proof.
- Estée Lauder ruled the prestige color cosmetics landscape with the acquisitions of both BECCA in October and Too Faced Cosmetics in November.
- Glansaol emerged as a new strategic acquirer with the announced acquisitions of Laura Geller, Julep and Clark’s Botanicals.
- Strategic buyers accounted for approximately 80% of the transactions in the quarter with deals also announced by Coty and Edgewell.
- Contract manufacturing continued to witness high M&A activity.
- Private equity played a smaller role in Q4’16 but we did see a minority deal from Alliance Consumer Growth.