L’Oréal CEO Nicolas Hieronimus Leads Largest Acquisition in Company History

The acquisition will strengthen L'Oréal's luxury company portfolio, its largest division.

Middle aged man wearing glasses and blue suit.
L’Oréal CEO Nicolas Hieronimus. ERIC PIERMONT/AFP via Getty Images

L’Oréal purchased Aesop, an Australian cosmetics company, for $2.5 billion in the largest acquisition in the company’s history, announced the French beauty giant in a statement yesterday (April 3).

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The sale reportedly comes after months of negotiations with other interested buyers, including luxury conglomerate LVMH, headed by the world’s richest person Bernault Arnault; and Japanese makeup company Shiseido.

Aesop, which was created in 1987 by Melbourne hairdresser Dennis Paphitis, has been owned by its parent company Natura & Co since 2017. The beauty brand is known for its distinctive minimalist bottles and sells skincare, haircare and fragrance products at a high price tag, offering incense and hand soap for more than $40.

“Aesop is the epitome of avant-garde beauty, whose products are not only made with great care and exceptional attention to detail; they are a superb combination of urbanity, hedonism and undeniable luxury,” said Nicolas Hieronimus, CEO of L’Oréal, in a statement.

Hieronimus was announced as L’Oréal’s CEO in October 2020. He has worked at the company since 1987, first joining as a sales representative, according to WWD. In the mid 1990s, Hieronimus helped create the Fructis brand for Garnier and subsequently managed Garnier and Maybelline the U.K., where the company’s sales rose 44 percent and 40 percent between 1998 and 2000.

Before becoming deputy CEO in 2017, Hieronimus led the L’Oréal Luxe division between 2011 and 2018. Under his leadership, the company’s luxury product sales grew from 4.5 billion euros ($4.93 billion) to 9.37 billion euros ($10.26 billion).

Why did L’Oréal buy Aesop?

Aesop, which posted sales of $537 million in 2022, will help strengthen L’Oréal’s portfolio of luxury brands, a division that has grown significantly during Hieronimus’ tenure as CEO.

Brands such as Armani, Yves Saint Laurent and Lancôme are also in the L’Oréal Luxe division, which in 2021 became the French company’s highest-earning sector. It brought in 12.43 billion euros ($13.62 billion) compared to the 12.23 billion euros ($13.4 billion) generated by L’Oréal’s consumer goods division, which contains brands such as Garnier and Maybelline.

L’Oréal has 36 brands in its total portfolio and generated 38.26 billion euros ($41.91 billion) of sales in 2022.

“L’Oréal Luxe, our number one division and growth engine continues to outperform the luxury market both in sales and profitability,” said Hieronimus during an earnings call in February.

L’Oréal has made it clear that it intends to capitalize on the success of its luxury products. “I am extremely confident in our capacity to deliver consistent strong growth,” said Cyril Chapuy, president of L’Oréal Luxe, during the earnings call. “Desire for luxury amongst the global upper middle class is extremely robust.”

In L’Oréal’s press release regarding the Aesop acquisition, Chapuy additionally noted that he is confident Aesop will “join the L’Oréal Luxe Billionaire brands club and therefore contribute significantly to the growth of the Division in the years to come.”

The purchase of Aesop from Natura & Co, its Brazilian parent company, is also expected to provide Natura, which has suffered economically in the past few years, with debt relief. Natura CEO Fabio Barbosa said the sale will make his company’s debt “quite manageable,” as reported by Bloomberg.

“With a strengthened financial structure and a deleveraged balance sheet, Natura & Co, exercising strict financial discipline, will be able to sharpen its focus on its strategic priorities, notably our investment plan in Latin America,” said Barbosa in a statement.

L’Oréal CEO Nicolas Hieronimus Leads Largest Acquisition in Company History