The sizzle in the retail and apparel mergers and acquisition scene might be gone for now, but the beauty world is abuzz with deal activity.
This story first appeared in the February 24, 2012 issue of WWD. Subscribe Today.
Murmurs have been building around Urban Decay and now StriVectin. A source said Deutsche Bank sent out books detailing the finances of Urban Decay to potential strategic buyers last week and that StriVectin hired investment bank Goldman Sachs to explore a sale.
Urban Decay has been on the beauty M&A radar for some time, but StriVectin is relatively new to the rumor mill.
StriVectin, the facial skin care company that used to make stretch mark cream, was purchased by private equity firm Catterton Partners in July 2009. The brand, which industry sources estimate generates $135 million in retail sales, is managed by Chrysallis, Catterton Partners’ beauty industry-focused management team. In recent years, Chrysallis has reformulated, repackaged and repositioned the line — and trumpeted those changes through an advertising campaign. Asked if StriVectin is in search of a buyer, Melisse Shaban, chief executive officer of Chrysallis, said, “no comment.”
Speaking generally, Shaban does expect to see several deals happen this year. Referring to the pulse of M&A, she said, “It’s an active time and there are assets out there that have value.” And that’s a good thing, she added. “We’ve got to keep the entrepreneurial spirit of beauty alive, otherwise there will be two brands and two retailers.”
Wende Zomnir, the creative director and co-founder of Urban Decay, also replied to the rumors surrounding her firm with a “no comment.” The Boston-based private equity firm Castanea Partners invested in the cosmetics brand — one of the last holdouts from the indie cosmetics brand craze — in March 2009. Investors from Castanea could not be reached for comment.
Goldman Sachs declined to comment and Deutsche Bank could not be reached Thursday.
Goldman Sachs is a giant on the M&A scene and Deutsche Bank has been garnering the interest of potential sellers since it advised Smashbox in its 2010 sale to the Estée Lauder Cos. Inc. Last month, skin care firm Yes To Inc. was also said to have been close to hiring Deutsche Bank to explore a sale.