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6 Apr

Why L’Oreal Acquired Aesop – WWD

PARIS — What are L’Oréal’s plans for Aesop, the Australian luxury personal care company that the group just signed an agreement to accumulate, marking its largest M&A move up to now?

Cyril Chapuy, president of L’Oréal Luxe, outlined strategy following the deal that was announced late Monday night.

As previously reported, the proposed transaction with the vendor, Brazil’s Natura & Co., values Aesop at greater than $2.5 billion. Aesop’s sales in 2022 were $537 million.

L’Oréal has expressed confidence that Aesop will within the near future join the Luxe division’s coterie of “billionaire brands,” which also include Lancôme, Yves Saint Laurent, Giorgio Armani Beauty and Kiehl’s.

WWD: What drew L’Oréal to Aesop?

C.C.: Aesop is a really unique luxury beauty brand, and I’ve been following it and loving it for quite a while. When the chance presented itself, we truly believed this could be a improbable addition to the L’Oréal Luxe portfolio. Its design-led brand essence, its highly efficacious and sensorial products, in addition to its customer-obsessed retail philosophy are very differentiating on today’s beauty market.

WWD: How does Aesop fit into L’Oréal Luxe’s portfolio of brands?

C.C.: Aesop is a real complementary brand to our portfolio, and its signature positioning will likely be a key asset for our future development. [It is] a brand that has been traditionally centered around body care, and has more recently expanded into skincare and fragrances, which anchors it to the luxurious beauty market. Quite simply, Aesop is a diamond of holistic beauty that may make our Luxe division even stronger.

WWD: What are another key strengths of Aesop?

C.C.: Aesop is understood for its efficacious and sensorial products, with plant-based ingredients and sustainable vegan formulations. Aesop’s strong brand ethos and core social and environmental values are key to its success.

WWD: What will likely be leveraged at Aesop?

C.C.: From a category standpoint, we’re the leaders in fragrances, [and] we consider we will take the brand to recent heights here, because of our unique olfactory savoir-faire. And the skincare will profit from our innovation and R&I capabilities. From a geographical standpoint, we’ll leverage our knowledge of the Chinese market and expertise in travel retail.

WWD: That are the primary orders of the day as L’Oréal integrates Aesop?

C.C.: My first two priorities for this will likely be the completion of the deal that is anticipated by H2 and second, welcoming the Aesop [chief executive officer] Michael O’Keeffe along with his experienced and talented team. We aspire to cultivate Aesop’s uniqueness and values, and to take the brand to recent heights together.

WWD: How will L’Oréal develop Aesop’s retail network?

C.C.: Aesop currently operates around 400 points of sale across the Americas, Europe, Australia, Recent Zealand and Asia, with a nascent footprint in China, where we now have two stores in Shanghai. L’Oréal Luxe will nurture this footprint and grow recent opportunities, while continuing to deal with the brand.

WWD: Will L’Oréal proceed to make acquisitions in the luxurious beauty segment?

C.C.: We’re all the time looking and assessing great opportunities to make sure we now have the perfect and most relevant portfolio of luxury brands.

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