L’Oréal has agreed to sell The Body Shop to Brazilian cosmetics manufacturer Natura Cosméticos for £880m as it seeks to ramp up its international credentials.
L’Oréal, which has owned The Body Shop for 11 years, said in a statement it has signed a contract with Brazil’s leading cosmetics firm.
The proposed deal is subject to clearance by the Brazilian and US regulatory authorities, BBC reported, but is expected to complete before the end of 2017.
On June 9, 2017, Retail Week reported that L’Oréal had entered into exclusive talks with Natura Cosméticos over a €1bn (£0.89bn) sale of The Body Shop.
The ethical beauty retailer’s likely new owner was a surprise bidder for the business.
Private-equity firms including CVC Partners, Investindustrial and Chinese conglomerate Fosun were some of the businesses previously bidding to acquire the retailer.
At the time of the new bid, L’Oréal chairman and chief executive Jean-Paul Agon said: “I am very pleased to announce Natura as the potential new ‘home’ for The Body Shop.
“Natura will support The Body Shop’s development in the long term and enable it to best serve its customers while respecting its strong commitments towards its employees, franchisees and stakeholders.”
The Body Shop chairman and chief executive Jeremy Schwartz added: “The ethical values and expertise of Natura make it the perfect new owner for the Body Shop to accelerate the rejuvenation of the brand and its future expansion.”
L’Oréal has owned The Body Shop since 2006, but the retailer has struggled with flagging sales in recent years and posted a 38% drop in full-year profits in February.