Performance Decline Leads The Body Shop to Be Sold to Private Equity Firm... Price Slashed to One-Third (Comprehensive)

Sale Price 340 Billion KRW

British natural cosmetics brand The Body Shop has been sold to European private equity firm Aurelius. The sale price was ?207 million (approximately 340 billion KRW), about one-third of the 2017 acquisition price of €1 billion (?870 million).

According to major foreign media on the 14th (local time), Brazilian cosmetics company Natura, which is undergoing intensive restructuring, announced that it has signed a contract to sell its subsidiary The Body Shop to the Aurelius Group.

In April, Natura sold its subsidiary Aesop to French company L'Or?al for $2.53 billion, and in August, the board resolved to seek strategic alternatives including the sale of The Body Shop, which has been struggling due to deteriorating profits.

Aurelius is known as a private equity firm specializing in the 'buyout' sector, which increases corporate value through management support after acquiring company shares and then resells them. Tristan Nagler, partner at Aurelius, said, "This deal will be an opportunity for The Body Shop to establish a new position in the online beauty market."

[Image source=Reuters Yonhap News]

Natura is Brazil's largest cosmetics company, operating in over 100 countries. It rapidly grew into the world's fourth-largest cosmetics group by sales after acquiring Australia's premium skin and body care brand Aesop in 2013 and The Body Shop from L'Or?al in 2017, but has since experienced poor performance due to management deterioration.

Natura's sales in the third quarter of this year recorded 7.517 billion reais, a 10.5% decrease compared to the same period last year. However, due to cash inflow from the sale of Aesop, it posted a net profit of 7.024 billion reais, successfully turning to a profit from a net loss of 560 million reais in the same period last year. A British foreign media outlet commented, "This sale shows that Natura's ambitions toward the global beauty industry are retreating."

The Body Shop is a British cosmetics brand advocating naturalism, offering a wide range of products from skincare and body care to perfumes. The Body Shop has continued to see a sharp decline in sales due to changes in distribution channels in the cosmetics market triggered by the pandemic and intensified competition from similar brands. Its sales in the third quarter of this year were 830 million reais, down 13.2% compared to the same period last year.

Fabio Barbosa, CEO of Natura, said, "With the sale of The Body Shop, we plan to reduce debt and focus our capabilities on the growth of other businesses such as Avon."

Natura's stock, listed on the S?o Paulo Stock Exchange, closed at 14.30 reais, up 2.88% from the previous session. Based on the closing price, Natura's market capitalization was approximately 19.7 billion reais (about 5.3 trillion KRW) on that day.

This content was produced with the assistance of AI translation services.