Shiseido acquires Bare Escentuals

The Tokyo-based company Shiseido has made a dramatic entry into the natural cosmetics market by acquiring Bare Escentuals, an American producer of mineral cosmetics, Organic Monitor reports. In a deal worth 1.7 billion US $, this is the cosmetic firm’s biggest acquisition and so far the largest deal in the natural cosmetics industry. Shiseido, Japan’s largest cosmetics company, was established as early as 1872 and owns beauty brands such as Shiseido, Elixir Superieur and Maquillage. Although Shiseido operates in more than twenty countries, the bulk of its 7.5 billion $ sales are from its home market. The San Francisco-based company Bare Escentuals has been listed on the Nasdaq stock exchange since 2006 and has shown remarkable growth, expanding from a 20 million $ small outfit to a 600 million $ business over 10 years. It is the world’s leading producer of mineral cosmetics, marketing its products under the i.d. bare Minerals, i.d. cosmetics, and Rare Minerals sub-brands. About 85 % of the American company’s sales are from its home market.
 

By acquiring Bare Escentuals, Shiseido has entered a fast growth and highly profitable sector of the cosmetics industry. Global natural cosmetic sales are growing by over 15 % a year, with Bare Escentuals being one of the largest operators in North America. Organic Monitor sees this as an important acquisition that gives synergy to both companies. The purchase gives Shiseido access to the high growth natural cosmetics market and also helps the Japanese company achieve its target of raising its overseas sales to 50 % by 2017. Organic Monitor expects Bare Escentuals to utilise Shiseido’s distribution networks and internationalise its sales. Premium channels, such as department stores and beauty retailers, are most suited to the mineral cosmetics range of Bare Escentuals.

Organic Monitor