Bain, Goldman agree $2.7b exit from Carver Korea

The announcement comes just 14 months after the two investors bought into the business, paying about KRW430 billion ($380 million) between them. Sang-Rok Lee, Carver’s founder and chairman, retained a minority interest and continued to participate in day-to-day management.

The transaction was expected to drive domestic growth and stimulate overseas expansion for the company, which currently markets about 1,000 products across Korea, China, and the US. Building market share in China – primarily through regular import channels and onto the shelves of third-party specialty and drug stores – was a particular priority.

Founded in 1999, Carver focuses on skincare products, including its flagship brand AHC, or Aesthetic Hydration Cosmetics. In addition to face cream, the AHC range, which focuses on age management and hydration and nourishment, includes essences, toners, moisturizers, masks, and sun protection. According to Unilever, sales amounted to EUR321 million in 2016 while EBITDA reached EUR137 million.

The Anglo-Dutch conglomerate said the acquisition would strengthen its position in North Asia and complement its existing portfolio by offering luxury skincare products at affordable prices. Korea is the fourth-largest skincare market globally and its beauty products – as with the country’s cultural assets on a broader level – have demonstrated significant cross-border appeal. Various private equity investments over the last two years have tapped into this theme.

“This has been a great opportunity for us to partner with a leading Korean company in an exciting segment of the cosmetics space and to help support its brand, operations and growth around the world. Unilever is a strong partner to help the company in its next phase of growth and development,” Ed Han, a managing director at Bain, said in a statement.

The private equity firm followed up on its investment in Carver with an agreement in April to buy a controlling stake in Hugel, a Korean manufacturer of botox and other health-related pharmaceuticals. The deal was worth KRW927.4 billion, with Bain expected to take a 45% stake in the business.

Other PE activity in Korea’s beauty industry includes IMM Investment’s $330 million acquisition of a controlling stake in Able C&C; CDIB Capital’s investment in L&P Cosmetic, a producer of high-end facial masks; VIG Partners paying KRW146 billion for a majority interest in Press & Converting, another facial masks manufacturer; and L Catterton’s $50 million commitment to color cosmetics manufacturer Clio Cosmetics.

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• Topics
• North Asia
• Trade sale
• Consumer
• South Korea
• Bain Capital Asia
• Goldman Sachs
• Exit