Beauty Care M&A Continues Rebound and Prepares for Big 2021 Finish

Newletter BeautyCare MAReport Q3 21

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Beauty Care M&A volume continued its strong pace with 27 transactions in Q3’21, up over 42% from pandemic-impacted Q3’20. Deal volume was down slightly from Q1’21 and Q2’21 as the markets digested the first-half rebound and prepared for what will inevitably be a big finish to the year.

Similar to last quarter, deal volume was led by private equity activity. However, whereas Q2’21 was dominated by minority investments, Q3’21 witnessed heavy investments in beauty care platforms – including WM Partners’ investment in Raw Sugar, Advent’s acquisition of multiple brands from Shiseido, L Catterton’s investment in Beauty Industry Group, and Hildred-backed platform Crown Laboratories’ acquisition of StriVectin. Strategic buyers remained active as well with the acquisitions of Arctic Fox by LG Household & Healthcare and BWX’s acquisition of Go-To Skincare. Interestingly, in both cases, the strategic acquirer purchased less than 60% ownership.

In addition, the public markets continued to attract beauty care companies with the initial public offerings of premium hair care brand Olaplex in September and Italian beauty care contract manufacturer Intercos in October. Finally, venture capital dollars continued to pour into the Beauty Care sector with multiple funding rounds exceeding $50 million for brands including Beauty Pie, Quip, MyGlamm, Glossier, and Mamaearth.

Finally, the Intrepid Beauty and Personal Care Group remained active in Q3’21 having advised Raw Sugar on its investment by WM Partners and Apostrophe on its acquisition by Hims & Hers. Intrepid anticipates an incredibly strong (and potentially record-setting) fourth quarter given the continued post-pandemic rebound and momentum from the previously anticipated capital gains tax increases in 2022.

Q3’21 Beauty Care M&A highlights include:

  • Deal volume was up over 42% from Q3’20 but down 10% from Q2’21.
  • Private equity platforms led the way with related investments by WM Partners, Advent International, L Catterton, and Hildred Capital.
  • Strategic buyers shifted to majority (versus full) buy-outs in both LG Household & Healthcare’s acquisition of Arctic Fox and BWX’s acquisition of Go-To Skincare.
  • Early-stage venture capital and initial public offerings continued to add growth capital to the Beauty Care market.
  • Intrepid closed two beauty care deals in the quarter having advised Raw Sugar on its investment by WM Partners and Apostrophe on its acquisition by Hims & Hers