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Revlon buys rival Elizabeth Arden

Revlon is to take complete ownership of Elizabeth Arden in a deal valuing the target at US$870 million.

The two companies say that by bringing together two highly complementary, iconic brand portfolios, Revlon will benefit from greater scale, an expanded global footprint, and a significant presence across all major beauty channels and categories, including the addition of Elizabeth Arden’s growing prestige skin care, color cosmetics and fragrances.

“The combination will leverage Revlon’s scale across major vendors and manufacturing partners, improving distribution and procurement. Cost synergies of approximately $140 million are expected to be achieved through the elimination of duplicative activities, leveraging purchasing scale, and optimising the manufacturing and distribution networks of the combined company,” the two companies said in a joint statement.

Revlon president and CEO Fabian Garcia described the deal as “strategically and financially compelling”.

“Elizabeth Arden and Revlon are both known for their iconic brands, entrepreneurial spirit and commitment to innovation, quality and excellence. Revlon plans to build upon Elizabeth Arden’s ongoing transformation by further enhancing the brand, with even more vibrant and relevant product development and marketing, while carefully preserving its unique heritage within prestige.

“Combining our brands, talent, and global distribution will give our company a significant presence in all major channels and categories, while accelerating sales growth in existing and new geographic regions. We look forward to bringing together our two top-notch teams to form a global leader in beauty,” he said.

Elizabeth Arden president and CEO Scott Beattie said the takeover recognised the unique equity in the Elizabeth Arden brand, its impressive fragrance portfolio and global footprint, as well as the positive momentum and growth potential for our business.

“We look forward to working with the Revlon leadership team to create a leading global beauty company, able to provide accelerated growth for the Elizabeth Arden-branded products as well as our prestige licensed fragrance portfolio, and broader opportunities for many of our employees.”

Revlon’s strength and expertise in color cosmetics, hair care, men’s grooming, antiperspirants, deodorants and beauty tools will be complemented by the addition of Elizabeth Arden’s portfolio of licensed prestige fragrances and the internationally recognised line of Elizabeth Arden-branded prestige skin care, color cosmetics and fragrance products.

The companies believe Elizabeth Arden’s strong global reach in prestige distribution and travel retail will complement Revlon’s strength in mass and salons, strongly positioning the combined company in all key beauty channels.

On a geographical basis, Revlon currently sells its products in approximately 130 countries and Elizabeth Arden has a strong presence in important international growth regions, including Asia Pacific, positioning both brands to better compete globally.

After the merger, Beattie will join Revlon’s board as non-executive vice chairman. He will also serve as a senior advisor to Garcia.

The deal should close by the end of 2016.

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