Over the past year, Australian health and beauty companies have become hot M&A targets. Last March, for example, L’Occitane acquired majority control of Grown Alchemist and more recently L’Oréal stunned the global cosmetics industry with its multi-billion dollar acquisition of Aesop.
Australian vitamin and mineral makers have built up a strong following in Asia and in 2015 Hong-Kong-based Biostime bought Swisse for US$1.1 billion. Blackmores is the latest Aussie health brand to attract a bullish bid. Kirin, the Japanese drinks titan, has stumped up $1.88 billion to acquire the benchmark Aussie vitamins and supplements brand.
Founded in 1932, Blackmores opened Australia’s first health food store and the brand is in strong demand in China and 16 other countries across the Asia/Pacific region. The daigou boom was a godsend to the company’s bottom line, but when the Covid-19 pandemic arrived the so-called “suitcase trade” declined and Blackmores has been trying to re-build the business to the same level over the past few years.
Kirin Group dominate the Australian beer market. The Japanese giant took control of Lion Nathan ( now Lion), the maker of Tooheys, XXXX and leading craft beers like Hahn, for $3.3 billion in 2009. But the multinational has been pursuing a strong diversification program to limit its dependence on alcohol sales. A major part of the strategy is Kirin’s health science business, where Blackmores will join brands popular in Asia such as Cognizin.
Blackmores enjoyed sales of $649.5 million in FY22 as it clawed its way back from the dip in sales following its popularity with daigous.
Beer revenues in Japan have been falling for some time and Blackmores presents an exciting opportunity to transform the scale and reach of our health science domain, said Yoshinori Isozaki, CEO and president of Kirin. Blackmores pre-eminence in Australia and Asia will help the multinational meet its goal of US$3.7 billion in sales from its health science unit by 2030.
“The Kirin proposal recognises the strong leadership position that Blackmores, through its brands and people, has established in the natural health sector across the Asia Pacific region over our long history,” said Alastair Symington, CEO and managing director of Blackmores.
“Importantly, it also confirms the significant opportunity that lies ahead for our employees and other key stakeholders of Blackmores as both companies come together to combine their focus on growing Kirin’s health science business across the world”.
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