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‘Mascara effect’ spurs acquisition of online beauty business

Online beauty retailer Gorgeous Shop Ltd (GSL) has acquired competitor LDLP Ltd, better known as Beauty Flash, in a deal supported by our corporate finance team.

It comes as Covid-19 has ushered in a new era for make-up trends due to the wearing of face masks in public, dubbed the ‘mascara effect’.

Based in Berkhamsted, Hertfordshire, Gorgeous Shop is a third party distributor of premium haircare and beauty brands. The company contracts with major brand owners such as Dermalogica, Decleor and Redken for supply and typically enters into selective distribution agreements which provide for continuity of supply and maintenance of retail pricing.

Gorgeous Shop and Reading-based Beauty Flash will now form the Gorgeous Retail Group (GRG).

Funding provided by private equity firm Connection Capital will allow the newly formed GRG to increase its market share in terms of supplier contracts and customer base, as well as giving flexibility to consider future acquisitions.

Photo: Wavebreakmedia

PKF Francis Clark’s corporate finance team provided lead due diligence services on the acquisition, supporting Connection Capital in the investment.

Ruth Salsbury, GSL’s finance director, said: “PKF Francis Clark were key to supporting our acquisition of Beauty Flash, providing due diligence services on GSL, Beauty Flash and GRG for the purposes of obtaining funding from Connection Capital. The approach taken to carry out due diligence, and the flexibility to report under pressure, helped us meet the required deadlines on an important transaction for us.”

PKF Francis Clark’s team comprised Paul Crocker, Sam Phillips and Tom Hicks.

Sam said: “Online retail is an exciting sector, and one with huge potential and resilience during these uncertain times. We were delighted to support Connection Capital in the due diligence of GSL and Beauty Flash, in an entirely remote process, to benefit from increased online activity in time for the Black Friday weekend. As a team we have built some excellent experience in helping online businesses navigate the due diligence process to ensure a successful transaction.”

To read about more of the recent deals our corporate finance team has advised on, click here.

FEATURING: Paul Crocker
Over his career Paul has been at the forefront of transactional work, both as a corporate finance adviser and a banker. The combination of over… read more
FEATURING: Sam Phillips
Sam is a Corporate Finance Director focusing on PKF Francis Clark’s Transaction Support and Due Diligence services, having previously worked at Grant Thornton and EY.… read more
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