By Ben Lucas
Brazilian cosmetics maker Natura &Co has agreed to sell The Body Shop to private investor Aurelius Group in a deal that values the firm at £207m.
Natura said the agreement includes a potential earn-out of £90m, adding that both the sale price and the earn-out would be paid within five years of the transaction closing.
The move represents the second major divestment by Natura this year as part of a broader organizational shakeup, following a deal announced in April to sell luxury brand Aesop to L’Oreal.
The sale of The Body Shop was “another important step in Natura &Co’s new development cycle to unlock significant value,” Natura Chief Executive Fabio Barbosa said in a statement.
“Refocused, deleveraged and leaner, Natura &Co will now be able to fully concentrate on its core relationship selling expertise in Latin America while also continuing the optimization of Avon International’s footprint,” Barbosa said.
Natura announced in August that its board of directors had authorized it to search for “strategic alternatives” for The Body Shop, including a potential sale six years after buying it from L’Oreal.
The company entered into exclusive talks with Aurelius last month.
Natura rapidly grew through high-profile acquisitions, including the purchases of The Body Shop, Aesop and Avon International, but ended up struggling with profitability.
That led it to launch a quest for “discipline” and deleveraging last year in order to return to profit.
In the third quarter, Natura &Co reported a net profit of 7 billion reais ($1.43 billion), swinging back from a 560 million-real loss a year earlier and boosted by the sale of Aesop.
