Beauty Care M&A volume rebounded with 30 transactions in Q2’23, an increase of 100% from the Q1’23, which marked the lowest volume quarter in almost 10 years.
Deal volume significantly increased from both strategic buyers and private equity groups alike. Notable strategic transactions included the acquisition of Aesop by L’Oréal, marking its largest acquisition to date, and the acquisition of Creed by Kering Beauté, representing the division’s first acquisition. Private equity activity regained momentum with deals announced by Gauge Capital, L Catterton, TruArc Partners, Prelude Growth Partners, Advent International, and Sandbridge Capital. In addition, strategics remained sellers throughout the quarter with brand divestitures from both Henkel and Natura & Co.
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The quarter also witnessed increasing interest in the public markets with Il Makiage & Spoiled Child owner Oddity filing for an IPO, Coty exploring a dual listing on the Paris Stock Exchange, and Puig implementing a new structure to allow for a potential future IPO. In addition to heightened public markets activity, venture capital support for beauty and personal care brands continued to surge throughout Q2’23.
Intrepid expects Beauty Care M&A deal volume to remain in line or below 2022 levels through the second half of 2023. Despite strong sector performance and continued industry growth within a depressed consumer discretionary environment, Intrepid believes many high-quality beauty care assets will continue to remain on the sidelines until broader industry headwinds begin to tail off and macroeconomic concerns lighten.
Q2’23 Beauty Care M&A highlights include:
• Deal volume was up 100% from Q1’23 and 25% from Q2’22.
• Increased activity from strategic buyers including deals announced by L’Oréal, Pierre Fabre, Kering Beauté, Combe, Performance Beauty Group, and Beauty International.
• Strategic buyers continued to be sellers in the quarter with divestments from Natura & Co. and Henkel.
• Strong investment activity from the private equity community including deals announced by Gauge Capital, L Catterton, TruArc Partners, Prelude Growth Partners, Advent International, and Sandbridge Capital.
• Increasing private equity interest and consolidation in the MedSpa sector.
• Intrepid advised Loving Tan on its investment by Gauge Capital.