By Chesney Hearst, Senior Contributing Reporter
RIO DE JANEIRO, BRAZIL – On Monday, September 8th, French cosmetics company L’Oréal announced its plans to acquire Niely Cosmeticos Group, the largest independent hair-care and hair coloration company in Brazil. This new acquisition supports the company’s goal to add around fifty million Brazilian customers by 2020.
“We are thrilled to welcome Niely to the L’Oréal group,” President of L’Oréal Brazil Didier Tisserand, said in a prepared statement. “Niely benefits from an excellent position and high penetration of the growing Brazilian middle class and as such will positively complement the products offered by our Consumer Products Division in Brazil.”
Recently suffering weak gains in its consumer products line, L’Oreal, since January of this year, reportedly spent more than US$5 billion on various expansion deals. Brazil is the second largest market in the world for hair products and L’Oreal currently gets more than eight percent of revenue from Latin America.
Niely Cosmeticos is known in Brazil for its two main brands; Cor & Ton for hair coloration and Niely Gold shampoos and hair-care products. In 2013, Niely Cosmeticos saw net revenue of R$405 million. Founded by Daniel Fonseca de Jesus in 1981, Niely Cosmeticos currently owns two factories and a distribution center located in Nova Iguaçu, in the Baixada Fluminense area of Rio de Janeiro state.
“We are delighted to join L’Oréal,” said de Jesus, who will go on to work for L’Oréal Brazil as the Strategic Committee as Vice-President. “We are convinced this operation will allow Cor & Ton and Niely Gold consumers to benefit from all of L’Oréal’s marketing and Research & Innovation expertise. It is also a great opportunity for our people to pursue Niely’s adventure within the world’s leading beauty company.”
The amount L’Oréal will spend to acquire Niely Cosmeticos was not disclosed but some estimates place it around R$1 billion. The closing of the transaction is now subject to regulatory approval by the Administrative Council for Economic Defense (Cade).
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