L’Oréal Agrees To Acquire Professional Haircare Brand Color Wow

Color Wow, founded by Gail Federici in 2013, offers a range of products that have gained a loyal and devoted following among stylists, media, and consumers, L’Oréal noted.

A renowned brand in the US market, Color Wow, is experiencing rapid growth, the company noted. It is now omnichannel – distributed in salons and available on e-commerce platforms.

Omar Hajeri, president of L’Oréal’s professional products division, stated, “As a premium haircare brand, with high levels of proven efficacy at an accessible price point, this acquisition will give us an increased foothold in haircare and in the styling category. Convinced of its strong potential, our ambition is to make Color Wow a powerful brand worldwide.”

“Joining L’Oréal is an incredible opportunity for the entire Color Wow team,” said Federici, founder and CEO of Color Wow. “Becoming part of the world’s number one beauty company will set the stage for Color Wow’s continued success and help drive our innovation to new heights.”

The deal is subject to customary closing conditions, including standard regulatory approvals, L’Oréal added.

Analyst Comment

The acquisition of Color Wow is part of a stream of deals by L’Oréal, highlighting the company’s push for growth diversification, according to Barclays.

The brand is estimated to generate approximately €300 million in revenue and was looking for a buyer that could value the company at about $1 billion, Barclays added, citing reports from Reuters.

For L’Oréal, this would imply that it accounts for around 6% of sales in the professional segment, or less than 1% of the group’s total sales.

Last month, the company agreed to acquire a majority stake in the UK-based skincare brand Medik8.

Barclays said in a note, ‘These recent moves show an increased appetite by L’Oréal in the last year in diversifying further into focus areas – premium haircare and skincare that they have talked about as key areas of growth within global beauty.’

‘But other recent deals, including the Gladerma stake (not covered) and Dr. G, show their intent to ensure they are more present in other growth channels, which is sensible considering the moderation we have seen in global beauty growth over the last 18 months,’ it added.