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.