Beauty Care M&A witnessed unprecedented volume in Q4’21 with a whopping 45 transactions, up over 55% from Q4’20 and 67% over Q3’21. As anticipated, record-setting deal volume was driven by continued post-pandemic rebound, strong M&A and beauty care fundamentals, and momentum from the previously anticipated but unrealized capital gains tax increases in 2022.
Deal volume in Q4’21 was led by robust activity from both strategic buyers and private equity groups alike, including the who’s who of corporate beauty care acquirers and some of the leading beauty care financial sponsors. From a category perspective, skin care deals and several high profile hair care transactions dominated the headlines followed by a few deals in the cosmetics, personal care, and accessories sectors.
Intrepid anticipates Beauty Care M&A deal volume will decline in the first half of 2022 given the outsized activity in Q4’21 – some of which was undoubtedly driven by deals that got pulled from 2022 into 2021. Despite lower volumes, Intrepid expects Beauty Care M&A fundamentals will remain strong, resulting in continued interest and premium multiples for those sellers that chose to wait out the frenzied year-end deal environment
Q4’21 Beauty Care M&A highlights include:
- Deal volume was up over 55% from Q4’20 and 67% from Q3’21.
- Robust activity from strategic buyers including from beauty care heavyweights L’Oréal, L’Occitane, Beiersdorf, Edgewell, Amorepacific, Galderma, and Procter & Gamble.
- Strong investment activity from the private equity community including deals announced by Gryphon, Eurazeo, Summit, Blackstone, Juggernaut, Stride Consumer, North Castle, and Highlander.
- Private equity was also active on the sell-side with liquidity events announced by Alliance Consumer Growth, Prelude Growth Partners, Encore Consumer, and Westview Capital.
- In addition, the SPAC market was active with announced deals by Waldencast for the acquisition of Obagi and Milk Makeup
and by Bright Lights Acquisition for Manscaped.
- Premium skin care led the way with high profile brands such as Youth to the People, Chantecaille, Supergoop!, Farmacy Beauty, Revision Skincare, COSRX, Alastin, Glow Recipe, Skinfix, and Beekman 1802.
- Premium hair care made a strong showing with deals announced by Hairstory, OUAI, and L’ANZA.