Trilogy International says it will nearly double sales when it buys the country's largest independent cosmetics importer.
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The skincare and fragrance firm will pay up to $37 million for the Auckland-based CS, which represents luxury fragrance brands, including Marc Jacobs, Calvin Klein, Dolce & Gabbana and Gucci, as well as cosmetics brands, such as Max Factor, Natio, OPI, and many others. Its major suppliers include global industry heavyweights Coty, Procter & Gamble and LMVH.
The purchase agreement includes an upfront cash payment of $34 million and the possibility of two additional payments of $1.5 million each, depending on earnings growth, over the next two years.
The purchase will be funded entirely with bank debt.
It is expected to add $41 million in sales and $6.4 million in gross profit to Trilogy's full-year result, for the current year ending in March.
Trilogy chair Geoff Ross said the beauty market is growing strongly, and fits well with the company's current brands.
"As a major player in the NZ beauty and cosmetics industry, CS compliments our existing business, including very strong relationships with major retail partners and a national sales network, as well as expertise in on-line sales and the international beauty and cosmetics industry generally," he said.
Mr Ross said the current owners of CS will continue to manage the business for at least the next three years.
"CS will operate as a stand-alone entity and existing management will report to a subcommittee of the Trilogy Board led by Stephen Sinclair."
Trilogy International chief executive Angela Buglass will be retain responsibility for the Trilogy, Ecoya and Goodness brand businesses.
