Japan's Orix to Buy Health Food Company DHC for $2.1Bn
- Chaileedo Press
- Nov 11, 2022
- 2 min read
On November 11, Japan's Orix announced that it would acquire cosmetics e-commerce and health food company DHC. The acquisition is expected to amount to approximately 300 billion yen (about $2.1billion).
(Credit: Facebook official account of DHC)
Orix will acquire all of the company's shares from existing shareholders, including DHC's founder, chairman and president, Yoshiaki Yoshida (81 years old). It is said that after the acquisition, the brand will be maintained its brands and Orix will send directors to participate in the management.
Orix seems to highly value DHC's brand appeal. If it goes well, this will be Orix's most expensive acquisition to date. Orix said that after the acquisition, it will push forward with business restructuring and strive to increase its corporate value.
DHC is mainly engaged in cosmetics and health foods, and has a wide range of businesses including apparel and resort facility operations. The official announcement shows its operating income was $637 million and operating profit was $77 million for fiscal year 2021 (ending July 2021).
DHC's cosmetic business began in 1983, and all products are sold in the form of communication sales (telephone and internet). The products cover basic skincare, body care products, hair care products, men's skin care products, baby skin care products, and health food products, ranking in the top 10 in the Japanese cosmetics market.
Since 1995, DHC has been expanding its overseas market and has set up branch offices all over the world. In July 2003, DHC set foot in China and established Shanghai DHC Commercial Co. According to public information, as of 2008, DHC Shanghai has 1500 employees and more than 200 directly-managed counters in China.
Shanghai DHC Commercial Co. has a registered capital of 10 million yuan(about $1.4 million), and the founder of DHC, Yoshiaki Yoshida, is the chairman and legal representative of the company. DHC Corporation is the controlling shareholder of Shanghai DHC Commercial Co., holding 97% of the shares, the natural person originally held the remaining 3% of shares by Yuanyoujia.
It is worth noting that in recent years, DHC has been fined several times for false advertising and other reasons with a total penalty of nearly 2 million yuan(about $281 thousand). The administrative penalty judgment issued in May 2021 shows that the Pudong Market Supervision Bureau seized a number of sunscreen lotions sold by DHC in Shanghai that did not match the actual content of the advertisements.
In July this year, CHAILEEDO learned from the official website of Shanghai Medical Administration that Shanghai DHC Commercial Co., Ltd. was fined 1.15 million yuan(about $162 thousand) for importing and selling two DHC products that did not comply with the technical specifications for cosmetic safety.
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