L'Oreal in Advanced Discussions for Majority Stake in Innovist at $350-$450 Million Valuation

L'Oreal in Talks to Acquire Majority Stake in Indian D2C Startup Innovist

L'Oreal, a French multinational cosmetics company, is reportedly negotiating a deal to acquire a majority stake in Innovist, a direct-to-consumer (D2C) personal care startup in India. The proposed transaction values Innovist between $350 million to $450 million (Rs 3,240 crore-4,170 crore), making it one of the largest strategic buyouts in India's consumer startup space in recent years.

The acquisition is part of L'Oreal's revised strategic plan to increase its market share in India, where it has been underperforming. L'Oreal's global CEO, Nicolas Hieronimus, had expressed dissatisfaction with the company's growth in India during the fourth quarter earnings call in February. He stated that India was not meeting expectations and that the company had a new set-up in place to bolster market share and be more ambitious.

Innovist, which was founded in August 2018, operates several brands, including Bare Anatomy, Chemist at Play, Sunscoop, and Vinci Botanicals. The company has its own manufacturing facility and offers a range of personal care products, including shampoos, serums, cleansers, and creams. Innovist is part of a crowded and competitive local market, with players like Purplle, Plum, Sugar Cosmetics, My Glamm, Pilgrim, Nykaa, and Honasa Consumer.

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The deal is expected to be sealed by April-end, subject to the progress of bilateral talks between L'Oreal and Innovist. The acquisition will be executed in a staggered or phased manner, with L'Oreal initially acquiring a controlling stake in Innovist, followed by a gradual roadmap to own 100% of the company.

Key Figures:

• $350 million to $450 million: valuation of Innovist
• Rs 3,240 crore-4,170 crore: valuation of Innovist in Indian rupees
• 1%: India's contribution to L'Oreal's turnover
• 49.7%: stake held by Innovist's founders
• August 2018: founding date of Innovist