L'Oreal, the French beauty giant, has made its biggest brand acquisition ever by purchasing Australian brand Aesop for $2.5 billion. The deal was announced on Monday by Aesop's parent company, Natura & Co, which also owns The Body Shop and Avon. Aesop, known for its luxury skin and body care products, will now be a part of L'Oreal's portfolio, which includes brands like Garnier and Maybelline. This acquisition surpasses L'Oreal's previous record of purchasing YSL Beauté for $1.7 billion in 2008, according to data from Dealogic. Natura & Co, Brazil's largest beauty and cosmetics company, will use the divestment of Aesop to reduce debt and focus on other growth opportunities, according to the CEO, Fabio Barbosa.
Aesop was established in Melbourne, Australia in 1987. In 2012, Natura acquired a 65% stake in the company, and then fully acquired it in 2016. Since then, Aesop's sales have surged by almost 20 times, from $28 million in 2012 to $537 million in 2022, according to Natura. Aesop's revenue also grew by double digits over the last year. The brand, which offers exfoliating hand wash, scented body lotions, and incense kits, is available in 29 markets, and is looking to expand further into mainland China, where it launched its first physical stores in 2021. In a statement, L'Oreal CEO Nicolas Hieronimus said that Aesop is well-positioned to benefit from current trends, and that L'Oreal will help to unlock its significant growth potential, particularly in China and travel retail. The transaction is scheduled to close in the third quarter of this year.