The prestige beauty retailer, best known for its first-to-market strategy and leading indie brands, first explored a sale in 2019
Cult Beauty specialises in trending brands, such as Biossance
British brand owner The Hut Group (THG) has acquired leading prestige cosmetics online retailer Cult Beauty for £275m.
Cult Beauty, founded by UK-based entrepreneurs Alexia Inge and Jessica DeLuca in 2008, specialises in independent brands and stocks the ‘coolest cult products the world’, according to its website.
Its 300-strong brand offering includes Youth to the People, Kate Somerville, Huda Beauty, Ouai and Supergoop.
Investment bank and consultancy firm JP Morgan was first hired by Cult Beauty in 2019 to advise on a possible sale, with fashion giant Asos reportedly interested in a takeover of the pure play retailer in May.
Cult Beauty is expected to contribute sales of £60m and adjusted EBITDA of £3m for the remainder of the financial year.
Manchester-based THG, which names rival e-commerce player Lookfantastic among its portfolio, said that around two-thirds of Cult Beauty's brands are not currently listed on existing THG Beauty websites, and that the disruptive retailer will retain a clear identity following the merger.
Matthew Moulding, and CEO of THG, said: “Cult Beauty is frequently the partner of choice for emerging indie brands due to its personalised, content-led approach and enthusiastic consumer base who are continually seeking new, innovative solutions to complement their beauty routines.
“Cult Beauty’s first-to-market reputation makes the brand an exciting fit for our THG Beauty division.”
According to THG, the deal will boost Cult Beauty's international presence via its THG Ingenuity platform; currently less than half of Cult Beauty’s sales come from outside the UK market.
Cult Beauty is also expected to offer a subscription box service following the acquisition, as THG owns the monthly cosmetic delivery services Glossybox and Lookfantastic Beauty Box.
Moulding added: “When retailing brands to consumers THG Beauty will run with two unique fascias within our main continents: THG will principally service customers within North America via our Dermstore and Lookfantastic brands, while in the UK, Europe, Asia and the rest of the world, the key brands will be Lookfantastic and Cult Beauty.
“We anticipate fully migrating Cult Beauty onto the THG Ingenuity platform by the end of the year (within the first six months of acquisition), giving the brand access to the global digital features to underpin significant future growth."