Shiseido has acquired Drunk Elephant for $845 million. The deal underscores the Japanese buyer’s ambitions to globalize its beauty offerings, but also indicates that purchase prices for beauty brands may be calming down.

Industry sources had originally speculated that Drunk Elephant, a popular indie skin-care brand that was said to have about $100 million in net sales for 2018, could be sold for $1 billion or even more. The auction process was said to have attracted a slew of big-name bidders, including Colgate, L’Oréal and the Estée Lauder Cos.

Source said it was never clear where the $1 billion idea came from, but that with the Shiseido sale, Drunk Elephant has achieved one of the highest sales multiples for a beauty brand. Continue reading →