The Parent company of Avon wants to split Aesop
- Chaileedo Press
- Oct 19, 2022
- 2 min read
Brazilian beauty giant Natura & Co recently said that the group is considering an IPO or a split of its skincare brand Aesop.
The announcement said that over the past few months, the IPO is still seen as an alternative way to fund Aesop's accelerated growth and that Natura & Co (Natura) management has taken steps in this regard. The strategy could also provide greater autonomy and attribution of responsibility to the Aesop brand and business units.
At the same time, Natura's Board of Directors has now approved a study aimed at evaluating whether it could be an alternative to the above-mentioned approach to help unlock more corporate value for both Aesop and Natura. Natura will compare the impact of a public offering and a split on the two corporates, and the Board will make a final decision only after the comparative study is completed.
However, the document also emphasizes that Aesop's current CEO Michael O'Keeffe will continue to lead the brand regardless of which move is ultimately taken.
Just last month, Brazilian beauty giant Natura said its board of directors had no plans to split its skincare brand Aesop or sell The Body Shop, denying rumors of a restructuring of its global business.
Currently, Natura's major brands include Avon, The Body Shop Aesop, etc. In the first half of this year, it saw a decline in both revenue and net profit, with net profit falling a serious 1869.5% to a loss of 1.939 billion yuan, while net income dropped 10.6% year-on-year to 23.342 billion yuan.
Aesop was the only brand that grew among Natura's four business segments, with a net income of 1.703 billion yuan in the first half of the year, achieving a 7.7% year-on-year increase. As of the first half of this year, Aesop has opened 275 stores in Madrid, Cambridge, Japan, South Korea, Australia, and other regions.
It is worth noting that in March 2021, Aesop's parent company Natura Group released its annual report, in which it first disclosed that Aesop would open a store in Shanghai, a decision that has since been publicly reaffirmed by the group's chairman. And just this year, Aesop's first brick-and-mortar store in China was set up in Shanghai.
Previously, because Aesop does not do animal testing, it has not been able to officially enter the mainland market offline and can only be sold in cross-border e-commerce channels. Last March. National Medical Products Administration mentioned in the policy interpretation of Provisions for Management of New Cosmetic Ingredient Registration and Notification Dossiers that "to fully consider and adopt the importing enterprises proposed by some countries and regions have implemented the ban on cosmetics animal testing market, can not submit animal testing information, conditional acceptance of animal alternative methods of toxicological testing information." This creates the conditions for Aesop to enter the Chinese market, which is mainly permanently opposed to animal testing.
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