Carlyle Acquires Majority Stake In VLCC

Global private equity major Carlyle acquired a majority stake in the Indian skincare and beauty platform VLCC for an undisclosed amount.

The equity for the transaction will come from funds managed and advised by entities affiliated with Carlyle Asia Partners, Carlyle said in a statement, without disclosing the terms of the deal.

The deal marks a strategic partnership with VLCC founders Vandana and Mukesh Luthra, who will continue to hold a significant stake in the company, it added.

Carlyle acquired a 65%-70% stake in VLCC for around 2,255 crore-2,460 crore rupees ($274 million-$299 million) via a primary infusion and secondary purchase of shares from the founders, according to the Economic Times.

The founders previously owned a 95% stake in VLCC, while the staff held the remainder 5% stake the company, the report said.

Carlyle said the investment in VLCC underscores its overall conviction in India’s long-term economic and domestic consumption growth, as well as product premiumization and a shift in preference amongst the rising middle-class toward established brands.

VLCC, founded in 1989, offers branded skincare products as well as high-end specialized beauty and wellness services, apart from aesthetic dermal treatments and weight management services across a network of 210 retail clinics in 118 cities and 11 countries in South Asia, the Middle East and Africa. VLCC also operates 100 skill development institutes in India.

KPMG India acted as the exclusive transaction advisor to VLCC and the founders.

Future Plans

"We plan to help VLCC accelerate growth through investments in brand building, product expansion, scaling its pan-India digital and e-commerce distribution channels, and expanding its local footprint of retail clinics," said Amit Jain, managing director and co-head of Carlyle India Advisors.

Carlyle said VLCC will appoint Gurveen Singh and J. Suresh as independent directors on its board.

Singh retired as the chief human resources officer at Reckitt Benckiser and brings with her over 40 years of experience in talent development and HR solutions, the investment firm said.

Suresh, who recently retired as the managing director and CEO of Arvind Fashions Ltd. had started his career with Hindustan Unilever Ltd., brings to the team over four decades of experience in the consumer and retail sector, it added.

Carlyle said their combined experience and sector expertise will help strengthen the board and provide strategic guidance for VLCC’s next phase of growth.

Carlyle has invested more than $5.5 billion of equity in over 40 transactions in India as of 30 September 2022, according to the statement.

(Note: $1 = 82.2700 Indian rupees)