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Beauty Care M&A volume continued to witness a post-pandemic rebound in Q1’21 with 29 deals, matching the robust year-end deal volume in Q4’20 and posting an increase of more than 11% from Q1’20. In addition to strong volume, the quarter also witnessed the return of large deals with three transactions valued at over $1 billion, including the sale of Shiseido’s personal care business to CVC Capital Partners, Estée Lauder’s acquisition of a majority stake in DECIEM, and American Securities’ acquisition of Conair. Private equity activity also remained strong, focused primarily on minority investments in high growth beauty and personal care brands, including investments by Alliance Consumer Growth, San Francisco Equity Partners, Monogram Capital Partners, Vaultier7, and recently formed Aria Growth Partners. Furthermore, Beauty Care companies looked to the public markets for growth capital and liquidity, most notably with Honest Co. filing for an initial public offering (IPO).
Despite the M&A rebound, the Beauty Care market continues to see fall-out from the COVID-19 pandemic as highlighted by the recent bankruptcy of L’Occitane’s U.S. division and closure of the Becca Cosmetics and Rodin Olio Lusso brands by Estée Lauder.
That being said, Intrepid sees strength in the Beauty Care market as evidenced by our clients and prospects’ performance and our growing Beauty Care M&A pipeline. As such, Intrepid anticipates continued momentum in the M&A markets in Q2’21 and for the remainder of the year.
Q1’21 Beauty Care M&A highlights include:
- Deal volume was up over 11% from Q1’20 and equaled the rebounded levels seen in Q4’20.
- Large deals returned to the Beauty Care M&A markets with three deals over $1 billion during the quarter.
- Private equity groups focused primarily on minority investments in high growth beauty brands.
- Beauty Care companies increasingly looked to the IPO markets for growth capital and liquidity.
- The trends towards both venture capital financing and consolidation in the Beauty Care contract manufacturing sector continued into the new year.