Doubling Down On Skincare: e.l.f. Beauty Acquires Skin Care Brand Naturium For $355M

e.l.f. Beauty Inc (NYSE: ELF) has signed a definitive agreement to acquire Naturium skincare brand for $355 million. The transaction will happen in a combination of both cash and stock.

The company expects the deal to double its presence in skin care to approximately 18% of retail sales. 

"Naturium aligns with e.l.f. Beauty's vision to create a different kind of beauty company with brands built to disrupt norms, shape culture and connect communities through positivity, inclusivity and accessibility,” said Chairman and CEO Tarang Amin.

Naturium had a net sales growth of approximately +80% CAGR over the last two years and about $90 million of net sales expected this year.

e.l.f. Beauty plans to continue to operate the Naturium business from its headquarters in Los Angeles.

e.l.f. Beauty expects Naturium to contribute approximately $48 million in net sales, approximately $9 million in adjusted EBITDA and approximately $0.04 in adjusted EPS on a fully diluted basis in fiscal 2024. 

The transaction, which is subject to customary closing conditions, is expected to close around September 30, 2023.

ELF expects to finance the transaction using available cash on hand, borrowings under existing credit facility and approximately $70 million, or approximately 600,000 shares, of stock issued directly to founders and key management.

The company held $142.5 million in cash and equivalents as of June 30, 2023.

Price Action: ELF shares closed higher by 1.62% at $122.63 on Monday.