Two brands will boost the growth of its fragrance business: L’Oréal announced on Tuesday that it has entered into exclusive negotiations with Clarins to buy the Mugler and Azzaro brands from it.
“The fragrance sector is at the heart of L’Oréal’s global growth strategy”, explained the CEO of L’Oréal Luxe Cyril Chapuy, said in a press release from the company.
“These signatures with a long history in style and olfaction complement our portfolio,” he said. L’Oréal Luxe is the division of the French giant with the brands Lancôme, Yves Saint Laurent, Giorgio Armani and Kiehl’s, and has a turnover of 9.4 billion euros.
The Mugler and Azzaro brands represent about 26% of the unlisted company with a turnover of 1.6 billion euros in 2018, or more than 400 million euros, a source told the bank. AFP.
The amount of the transaction was not disclosed.
The French cosmetics company hopes to complete this acquisition in the second half of this year, based on the receipt of agreements of the regulatory authorities and after negotiations with the representatives of the employees.
Mugler and Azzaro “are brands that, with the influence of L’Oréal, can have a significant influence”, said for AFP Serge Carreira, professor at Sciences Po Paris and expert in fashion and beauty .
This acquisition will help transform the perfume industry of the French giant, and “the world of perfumery is a world where distribution plays a major role, so the need to have more important”, he added.
In 2015, the American company Coty bought for 12.5 billion dollars the beauty and fragrance works of its friend Procter & Gamble, including perfumers Hugo Boss, Dolce & Gabbana, Lacoste.
“We are seeing a market going towards independent brands, with little to offer, or very large companies,” continued Serge Carreira.
-Angel, Alien, Wanted-
L’Oréal achieved a turnover of 26.9 billion euros in 2018 and has 86,000 employees worldwide. The company is in a very good position, boosted by strong demand in Asia, in the form of high-quality cosmetics and skin care products.
It expects a retail price of more than 300 euros, said its CEO Jean-Paul Agon in mid-April during the company’s general meeting. Tuesday shortly after 9:00 GMT, the company’s price appreciated by 1.04% to 251.90 euros, in a CAC 40 in equity.
Some Mugler or Azzaro perfumes are famous: “Angel changed the category, Alien is a blockbuster, Azzaro Pour Homme and Chrome are classics, Wanted and Wanted Girl revive the brand”, says and Clarins.
The first two “shine in the top 10 of the best perfumes in France, the United Kingdom, Germany and Spain”, welcomes the company on its website, citing a study by the research company NPD Group about 2017.
“If this project is successful, the two will find, within L’Oréal Luxe, the best conditions for their continuity and their development to the greatest benefit of our employees”, it is believed Christian and Olivier Courtin-Clarins, president and CEO of Clarins. .
The company employs 10,000 people and its perfumes are manufactured in Strasbourg by the Cosmeurop company.
“It’s good that we can, on our part, think about spreading the full power of our Nani work”, always showing the two sons of the company’s founder, Jacques Courtin- Clarins, who died in 2007.
“Clarins will be able to focus on the development of its great work, in a world that is greatly affected by computer technology and the arrival of new players”, said Serge Carreira.
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