Natura Cosmeticos SA entered exclusive talks to acquire British make-up seller Body Shop from L’Oreal SA with an offer that values the UK chain at 1 billion euros (US$1.1 billion).
An acquisition by Natura would represent a major expansion for the Brazilian cosmetics company, which originated as a direct-sales business like Mary Kay or Avon and expanded its retail operations with the US$70 million purchase of Australia’s Aesop in 2013.
The deal would give Natura new sales channels and more exposure to developed markets, although Body Shop is in “great need of a turnaround” and would require a lot of work, Eleven Financial Research analyst Giovana Scottini said.
“If everything works well, Natura will become a global cosmetics player, which is a whole different animal,” Scottini said. “This might require massive investments in marketing, which is another concern.”
Sao Paulo-based Natura is being advised by UBS and has already secured a financing commitment for the deal, a press official said.
Natura is studying issuing US dollar or euro notes to fund the acquisition and is not expecting a tough process to win approval from Brazil’s anti-trust agency, the press official said.
L’Oreal is being advised by Lazard.
The transaction with Natura would open a new chapter for the Body Shop, which was founded in 1976 by British entrepreneur Anita Roddick and has spent the past decade under the ownership of L’Oreal. For much of that period, the 3,000-store business struggled to contend with tough competition, leading L’Oreal to announce in February that it was exploring its options.
For L’Oreal, the planned deal is “good news given the under performance of the division in past years,” Raymond James analyst Hermine de Bentzmann said in a note.
The Body Shop operates across 66 countries. Its operating profit fell 38 percent to 33.8 million euros last year.
Natura is coming out of a tumultuous year that saw the exit of chief executive officer Roberto Oliveira de Lima, whose attempt to raise prices backfired. Sales rose 0.2 percent last year to 7.91 billion Brazilian reais (US$2.43 billion). The Body Shop’s total sales, including e-commerce and franchises, fell 2 percent to 1.48 billion euros.
Natura has already lined up financing for the 1 billion euros acquisition, chief financial officer Jose Roberto Lettiere said on a conference call with journalists on Friday.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
Clambering hand-over-hand, sweat dripping into his eyes, a durian laborer expertly slices a cumbersome fruit from a tree before tossing it down to land with a soft thump in his colleague’s waiting arms about 15m below. Among Thailand’s most famous and lucrative exports, the pungent “king of fruits” is as distinctive in its smell as its spiky green-brown carapace, and has been farmed in the kingdom for hundreds of years. However, a vicious heat wave engulfing Southeast Asia has resulted in smaller yields and spiraling costs, with growers and sellers increasingly panicked as global warming damages the industry. “This year is a crisis,”
HIGH-TECH: As leading-edge process technologies become more complicated, only a handful of players are able to provide design services, the company’s CEO said Artificial intelligence (AI) chip designer Alchip Technologies Ltd (世芯) yesterday said that revenue would grow significantly again in 2026 after adding a major AI chip customer, reversing moderation amid a product transition next year. The Taipei-based application-specific IC (ASIC) designer reiterated its strong revenue growth forecast for this year and 2026 after its stock plummeted about 23 percent to NT$3,145 from a peak of NT$4,085 on March 6 amid growing competition. Alchip said it has built strong partnerships with cloud service providers (CSP), denying that it had lost orders to smaller competitors such as Faraday Technology Corp (智原). Faraday said it has secured