Goldman Sachs and Bain acquire Korean Cosmetic firm
Korea: Carver, the South Korean cosmetics
firm has been acquired by Goldman Sachs Group (GS.N) and Bain Capital Private Equity
with an aim to tap the surging popularity of Korean Cosmetics products in
markets such as China, US, etc.
The company’s founder and Chairman Lee
Sang-rok who held a stake of over 60% at end of 2015, will now hold a minor
stake with participation in day to day management. The value of the deal has
been disclosed at USD307.45 million, which has been jointly paid by Goldman
Sachs and Bain.
The acquisition has benefited the
domestic cosmetic firms such as Amorepacific Corp, with share prices of these firms
surging at higher prices on account of sustained growth. In April-June, exports
over USD874 million which set a quarterly record.
Carver’s flagship product Skincare line
A.H.C. has been contributing to the company’s profit for considerable time period
now. The Company sells more than 1000 products across the globe. In 2015, the country’s
cosmetic exports grew at 44% as compared to previous years exports.
According to TechSci Research: With country’s cosmetic output rising at 20
percent year on year, the acquisition will help both the acquiree and acquirer.
Caver will able to produce more outputs on account of access to more resources
which will further help in boosting up of revenue.
Surging popularity of Korea beauty
products across the globe will lead to increase in the exports of products
which is anticipated to increase the country’s market share in the global
cosmetic market.
With increasing skincare problems across
the globe due to excessive use of chemicals and other substances in the cosmetics
products, the company should focus on organic cosmetics the demand for which is
expected to increase in coming years.