Dr. Jart+

The Estée Lauder Cos. Inc. is building up in Asia with a deal to buy full control of Seoul-based Have & Be. Co., bringing the Dr. Jart+ and Do The Right Thing brands fully into the fold. 

Lauder is buying the two-thirds of the company it doesn’t already own for about $1.1 billion. That gives Have & Be an enterprise value of about $1.7 billion. The deal, which will be paid for with debt, is expected to close in December and was made pursuant to the agreement Lauder cut when it took a minority stake in the company in 2015.

This is the beauty giant’s first acquisition of Asia-based beauty brands. And the deal brings Lauder a significant new business to build on.  

For 2019, Dr. Jart+, which produces skin-care collections such as Cicapair and Ceramidin, is expected to drive sales of more than $500 million — registering a compounded annual growth of over 80 percent for the past four years. The skin care brand is sold through specialty channels, travel retail, freestanding stores, department stores and e-commerce. 

“Dr. Jart+ combines skin, science and art with an eccentric twist,” Fabrizio Freda, president and chief executive officer of Lauder, told WWD in an exclusive statement. “Driven by innovation and creativity, the brand offers a wide range of effective skin-care products powered by science, pioneering forms and ingredients, innovative packaging and novel brand communication.”

The ceo said the two companies have envisioned a long-term partnership from the start. 

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“As the addition of the first midsized, fast-growing Asia-based global skin-care brand to our portfolio, Dr. Jart+ has tremendous momentum and potential across channels and geographies, especially in Korea, China, the United States, [Europe, the Middle East and Africa] and the U.K., and travel retail,” Freda said.

He said ChinWook Lee will continue to drive and build the brand as founder creative director. 

“We are excited about the potential for further sustainable and profitable growth via strategic expansion, as well as continued distinctive innovation with the brand’s signature twist,” Freda said.

Dr. Jart+ will help Lauder bolster its already strong position in skin care, adding to its reach in Asia, North America, the United Kingdom and in the travel retail sector. 

Lee, who founded the company in 2005, said: “The Estée Lauder Companies is the ideal home for our brands. Since the beginning of our partnership four years ago, the company has shared our mission to provide the very best skin care and beauty products to consumers around the world. We are excited for the opportunity to continue this partnership as we continue to innovate and grow our brands globally.”

Jane Hertzmark Hudis, group president at Lauder, will add Dr. Jart+ to the brands she oversees.

“The entrepreneurial spirit and creativity of Dr. Jart+ is a perfect fit for the Estée Lauder Companies,” said William Lauder, executive chairman at Lauder. “As consumers increasingly focus on skin care and the category continues its rapid global growth, the influence of cutting-edge, scientifically-driven brands like Dr. Jart+ is undeniable. We are delighted to welcome ChinWook Lee and his entire team to our family.”

The Dr. Jart+ deal could also mark a new expansion path for Lauder, one that starts with a minority investment that blooms into a closer relationship.

A spokeswoman for Lauder said: “The minority investment structure between Have & Be and ELC has been favorable for both parties over the past four years, allowing ELC early investment access to the emerging Dr. Jart+ brand, while simultaneously providing the founder and leadership a compelling opportunity (outside of private equity) to amplify its growth in both the short and long term.”

Investors signaled their approval of the deal by pushing shares of Lauder up 1 percent to $192.89, giving the beauty firm a market capitalization of $69.4 billion.

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