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BeautyMatter: Q4 2019 – Beauty Deals

The fourth quarter of 2019 didn’t disappoint, ending the year with some highly anticipated transactions. With several more mature indie brands off the market, it begs the question what impact this will have as we head into 2020. Our top 5 notable transactions are below. Read the full article on BeautyMatter here.


The hut group completes £1 billion capital raise

The Hut Group (THG), the digital-first consumer beauty and wellness brand group announced the completion of an oversubscribed £1 billion capital raise, delivering a step-change to its balance sheet ahead of anticipated macro-economic and political changes arising from the general election and Brexit.

WHO: The Hut Group was founded in 2004 by Chief Executive Matthew Moulding and CFO John Gallemore, and retails more than 8,000 brands and operates more than 160 localized web sites across 35 languages and 42 currencies. THG has become one of Europe’s largest online retailers of premium beauty brands. Other holdings include EyekoIllamasquaESPASkinstoreRY, Glossybox,, and Grow Gorgeous, Ameliorate, Acheson & Acheson, Christophe Robin.

WHY: The substantial capital raising enables THG to drive greater investment in its leading Beauty & Wellness brands and Ingenuity, its propriety, end-to-end e-commerce solution. The capital will also be used to invest in and enhance its freehold properties within its THG Events division, as well as ICON & THQ, the Group’s two landmark developments at Manchester Airport creating best-in-class content studios (270 sq. ft.) and offices (300 sq. ft.).

IN THEIR OWN WORDS: Matthew Moulding, founder and Chief Executive Officer of THG, said in a statement: “The expanded capital raising is a landmark achievement and provides an exceptional growth and investment platform for the business. The significant excess demand and new debt rating, and during the time of the general election, demonstrate the strength of THG’s business model and proposition and is further testament to the global model we’ve built. Our business continues to evolve with the demands of consumers, as we continue to invest across the Group to develop our people, infrastructure and particularly our proprietary e-commerce solution, Ingenuity.”

Ahmed Yeganeh, Managing Director for Large Corporate Banking, North Region, HSBC UK plc, said in a statement: “We have worked with THG for many years, supporting the business’s growth, investments in global infrastructure and acquisitions. We were delighted to act as Joint Global Coordinator in their first successful step into the institutional capital financing market and are looking forward to supporting their plans for the future.”

Na Wei, Managing Director, Barclays European Leverage Finance, said in a statement: “We were extremely impressed with the high level of market engagement and investor appetite for THG’s inaugural EUR600m capital market term loan issuance. This hugely successful benchmark transaction has cemented the Company’s future access to the capital market as it continues to grow and deliver its ambitious growth strategy.”

Sam Norton, Managing Director, Citi, said in a statement: “Unsurprisingly, THG has done it again—the success and significance of this 7-year maiden TLB issuance will be remembered as an inflection point in the Group’s history. It is yet another ringing endorsement of both the near term momentum and long term outlook of this uniquely positioned, global business and its best in class management team. Their leading equity story is now supported by a long term capital structure, fully aligned financing partners, and a fully-funded property strategy.”

William Abecassis, Head of Innovation Capital at BlackRock, said in a statement: “We are thrilled to be growing our investment in The Hut Group, a company that is at the forefront of retail digitalization. Their Ingenuity platform offers uniquely credible end-to-end solutions for global CPG brands seeking to transition to a digitally native footprint.”


  • THG has grown sales from £80MM (2010) to well in excess of £1 billion (2019), with two-thirds of revenues generated internationally across Europe, Asia, and the US. THG has rapidly grown profitability to industry-leading levels through its vertically integrated, technology-first consumer brand portfolio and technology services model.
  • Significantly oversubscribed €600MM Term Loan B (TLB) debt issuance which received €150MM of excess demand in only three weeks of marketing;
  • A new five-year £150MM revolving credit facility provided by Barclays, HSBC, Santander, Citi, NatWest, and JP Morgan.
  • New £200MM secured debt & development facilities provided by Citi and CBRE Investment Advisory to THG’s newly created, wholly owned subsidiary Propco holding company. Propco comprises THG’s property assets totaling 1.5m sq. ft. of freehold offices, distribution, and manufacturing centers, and the “THG Events” division properties (King Street Town House, Great John Street Hotel, and Hale Country Club); this will also facilitate the development of THG’s 1m sq. ft. HQ office campus.
  • £66MM of primary equity raised from global investment manager BlackRock, and Belgium-based investment company Sofina.
  • Citi, Barclays, and HSBC acted as Mandated Lead Arrangers and Joint Global Coordinators with Santander, JP Morgan, and National Westminster Bank as Mandated Lead Arrangers and Bookrunners on the financing.
  • THG was advised by Clifford Chance, Gibson Dunn, Gowling, EY Parthenon, Deloitte, and Eastdil Secured.

The vitamin shoppe sold for $208 million

Liberty Tax, the parent company of Liberty Tax Service and Buddy’s Home Furnishings, has acquired The Vitamin Shoppe in an all-cash transaction valued at approximately $208 million.

WHO: The Vitamin Shoppe is an omnichannel, specialty retailer of nutritional products based in Secaucus, New Jersey. In its stores and on its website, The Vitamin Shoppe carries a comprehensive retail assortment including: vitamins, minerals, specialty supplements, herbs, sports nutrition, homeopathic remedies, green living products, and beauty aids. In addition to offering products from approximately 700 national brands, The Vitamin Shoppe also carries products under The Vitamin Shoppe, BodyTech, Body Tech Elite, True Athlete, plnt, ProBioCare, and Next Step brands. The Vitamin Shoppe conducts business through more than 750 company-operated retail stores under The Vitamin Shoppe and Super Supplements retail banners, and through its website.

Liberty Tax, Inc. (OTC PINK: TAXA) is the indirect parent company of Liberty Tax Service and Buddy’s Home Furnishings. In the US and Canada, last year, Liberty Tax prepared approximately two million individual income tax returns in more than 3,100 offices and online. Liberty Tax also owns Buddy’s Home Furnishings, a specialty retailer engaged in the business of leasing and selling consumer electronics, residential furniture, appliances, and household accessories. Liberty Tax is focused on the evaluation and acquisition of franchise-oriented or complementary businesses. Liberty Tax also supports local communities with fundraising endeavors and contributes as a national sponsor to many charitable causes.

WHY: The Vitamin Shoppe transaction represents the continued evolution of the business model of Liberty Tax, and follows the recent acquisition of Buddy’s Home Furnishings, which was completed in July 2019. In recognition of this new strategic focus, Liberty Tax previously announced its intention to change its name to Franchise Group, Inc.

IN THEIR OWN WORDS: Pat Cozza, an independent member of the Board of Directors of Liberty Tax, stated, “We have great confidence in the value of The Vitamin Shoppe, its ongoing strategic reinvention plan and the outstanding efforts of The Vitamin Shoppe leadership team and associates. We believe that The Vitamin Shoppe is an excellent fit for Liberty Tax’s previously announced strategy to acquire franchise-centric businesses, and demonstrates the commitment of Liberty Tax, its board and management team to implement the previously announced strategic transformation of Liberty Tax.”

Sharon Leite, CEO of The Vitamin Shoppe, stated, “Following a careful and disciplined assessment, the board of directors has concluded that the acquisition proposal from Liberty Tax maximizes value for our shareholders. The transaction also delivers long-term benefits to our associates, customers and business partners. It provides an immediate premium to our current shareholders and aligns The Vitamin Shoppe with a partner that shares our strategic vision to unlock the further potential of The Vitamin Shoppe as a leader in health and wellness. We are committed to transforming into an agile, customer-first organization that differentiates our brand through best-in-class quality, innovation and expertise across our products and services.”


  • Liberty Tax acquired Vitamin Shoppe in an all-cash transaction valued at approximately $208 million.
  • The Vitamin Shoppe shareholders will receive $6.50 per share, which represents a premium of 43% to its closing share price on August 7, 2019, and a premium of approximately 59% to the 30-day volume-weighted average price for the period ended on August 7, 2019.
  • Liberty Tax intends to finance the transaction with up to approximately $170 million in debt financing and a combination of available cash and/or through the issuance of common stock of Liberty Tax.
  • Kirkland & Ellis LLP acted as legal counsel to The Vitamin Shoppe and BofA Merrill Lynch acted as its financial advisor. Troutman Sanders LLP acted as legal counsel to Liberty Tax.

Israeli makeup brand wow cosmetics acquired for us$15.7 million

Israeli color brand Wow Cosmetics has been acquired for US$15.7 million via London-based firm Fiver, the Teddy Sagi Group’s retail and e-commerce division.

WHO: WOW Cosmetics was founded in 2005 with the goal of introducing quality cosmetics products at competitive prices to the Israeli market. The retailer currently has 67 locations and employs some 500 people.

Billionaire Teddy Sagi has taken three companies public on London’s AIM. His other investments include co-working spaces and technology start-ups and now beauty.

WHY: The deal will allow the brand to launch an e-commerce site as well as expand its global footprint.

IN THEIR OWN WORDS: “We are always looking for interesting brands that can enhance our electronic commerce experience. We found Wow to be one of the interesting chains operating in Israel. The chain has excellent products and has gained popularity among Israeli consumers because of its excellent value prices. It is our intention, of course, to enhance and strengthen the chain in Israel, as well as in addition we plan to bring the benefits of Wow to other countries. In the first stage, we will do this with our e-commerce operations, so that we will market Wow online in European countries,”  said recently appointed Fiver CEO Shay Tangi.


  • Israeli-born billionaire Teddy Sagi acquired Wow Cosmetics via his London-based firm Fiver.
  • The acquisition is estimated at roughly NIS 55 million (approximately $15.65 million), according to Calcalist.

Lawless beauty receives growth funding from cult capital

Growth equity firm Cult Capital (formerly JMK Consumer) has made a significant minority investment in clean color cosmetics brand Lawless.

WHO: Lawless, founded by second-time entrepreneur Annie Lawless, offers clean color cosmetics focused on high-impact, full-coverage products. Lawless preserves the luxe and sexiness of an artistry brand while allowing the customer to maintain a clean, wellness-focused lifestyle. The company’s products are now sold through all Sephora doors,, as well as the Lawless website.

Cult Capital was founded 5 years ago by John Kenney and Sarah Woelfel and until now has been known as JMK Consumer. Cult Capital invests in consumer brands that hyper-connect with their followers and have a fiercely committed and loyal customer base. Cult Capital is currently partnered with Supergoop!, Miyoko’s, and Jaanuu. The firm also recently sold Babo Botanicals to Mustela.

WHY: For Cult Capital, Lawless’ positioning as a clean color cosmetics brand that doesn’t feel, sound, or look like any other clean makeup brand was the main point of attraction. The new capital will be used for product innovation, team expansion, and marketing efforts while simultaneously deepening the brand’s relationship with Sephora, who has proven to be an excellent partner.

IN THEIR OWN WORDS: “We love that Annie set out to create a brand that was clean (AF), but also sexy and fun,” says Sarah Woelfel, co-founder and Partner at Cult Capital. “Annie is such an inspiring individual and we are delighted by the opportunity to partner with her and the Lawless team. When building a Cult Brand, partnership is key, and partnership is what we found with Annie Lawless.”

“We feel strongly that our new name, Cult Capital, better reflects the degree of differentiation that we seek in consumer companies as well as the collaborative nature of our team, process and partnership with founders,” said Kenney.

“As someone who has raised capital before, I was hyper-focused on finding a partner that I was completely aligned with,” Lawless said. “I found true partnership with Sarah and the entire Cult Capital team. Cult has a deep understanding of what it takes to create a lasting brand name, and has a unique eye for the beauty space. Cult has the experience and partnership I needed to authentically scale my brand.”


  • Cult Capital (formerly JMK Consumer) has made a significant minority investment in clean color cosmetics brand Lawless.
  • Terms of the deal were not disclosed, but Cult generally invests up to $10 million per deal.
  • According to WWD industry sources said Lawless is expected to reach $10 million in sales for 2020.
  • Annie Lawless is not new to raising capital. She is a second-time entrepreneur, successfully selling a stake of her previous company, Suja, to Coca-Cola and others.
  • Two months after launch, Lawless was approached by Sephora, who was looking to make a push into clean color cosmetics.
  • Aside from new product launches, next year the brand is hoping to expand internationally to Europe and Australia but has not yet nailed down retailers.
  • Cult also backs Supergoop, and backed Babo Botanicals before its sale to Mustela.

Amorepacific makes minority investment in milk makeup

Amorepacific makes a minority investment in Milk Makeup and forms a strategic partnership that will help forge a path for Milk Makeup as they enter the South Korean marketplace.

WHO: Founded in 2015 by Mazdack Rassi, Dianna Ruth, Georgie Greville, and Zanna Roberts Rassi, Milk Makeup quickly became a cult favorite among beauty enthusiasts for its innovative formulas and clean ingredients. The brand delivers cruelty-free, paraben-free, 100% vegan formulas developed in-house at Milk Studios in Downtown NYC. Currently, Milk offers over 80 products through exclusive retailers, including in Sephora in the US, Canada, Spain, Germany, Denmark, and Sweden, and Cult Beauty in the UK.

Since 1945, Amorepacific has had a single, clear mission: to present its unique perception of beauty—namely what it calls “Asian Beauty”—to the world. As Korea’s leading beauty company, Amorepacific draws from its deep understanding of both nature and humans to pursue harmony between inner and outer beauty. With its portfolio of over 20 cosmetics, personal care, and health care brands, Amorepacific is devoted to meeting the various lifestyles and needs of global consumers around the world: Asia, North America, Europe, Oceania, and the Middle East. Amorepacific’s research hubs located around the world are dedicated to sustainable R&D that combines the best of natural Asian ingredients and advanced biotechnology.

WHY: Amorepacific and Milk are referring to the deal as a partnership. Milk is expected to benefit from Amorepacific’s regional expertise, and Amorepacific hopes to learn the Milk strategies as a fast-growing indie brand.

IN THEIR OWN WORDS: “The South Korean beauty market is highly competitive and incredibly innovative, so we are thrilled to have Amorepacific’s help to ensure our success in this important beauty space,” said Mazdack Rassi, CEO and co-founder of Milk Makeup. “This strategic partnership will allow us to benefit from Amorepacific’s significant expertise and resources. And in true partnership, Milk Makeup will share the strategies that have made it one of the fasting growing color brands in the US.”

“Milk Makeup is sought after by beauty enthusiasts for its innovative formulas and clean ingredients. Through this partnership, Amorepacific will provide full support for its entrance into the Korean market and others in the future,” said Bae Dong-hyun, President of Amorepacific Group.

“We were impressed by Amorepacific’s track record of internally starting and growing beauty brands,” noted Scott Sassa, chairman of Milk Makeup. “This shared belief in building brands designed to last for decades was central to establishing this relationship.”


  • Terms of the deal were not disclosed.
  • Amorepacific joins Main Post Partners and Alliance Consumer Growth as a minority investor in Milk Makeup. Main Post invested in 2017, and ACG invested earlier in 2019.
  • According to WWD industry sources estimated the brand will do $60 million in net sales for 2019.
  • Scott Sassa, chairman of Milk Makeup, led the multiyear process to put this deal together, according to the companies.
  • Ohana & Co. advised Amorepacific on the investment.

BeautyMatter was born from Founder Kelly Kovack’s desire to provide a fresh voice to a beauty industry hungry for more content from her perspective, and through her lens. BeautyMatter aim to fill the void, connect the dots, and provide an informed, analytical, and compelling point of view. Exploring limits and blurring boundaries, they offer highly curated news and original content by thought leaders and beauty insiders.
Purchase the full BeautyMatter Beauty Deals: M&A Transactions Q3 2019 report here.

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