Betterware adds Jafra to its catalog for $255 million – El Financiero

Betterware de México buys the cosmetics company Jafra for 255 million dollars, equivalent to 5 thousand 555 million pesos.

“We are excited to announce the acquisition of Jafra and believe it aligns perfectly with Betterware’s strategy. This acquisition will expand our growth potential by allowing us to expand our geographic presence to include North America,” said Luis G. Campos, executive chairman of Betterware’s board, according to a statement issued to the Mexican Stock Exchange (BMV).

He highlighted that with Jafra the firm expands its categories to include beauty and personal care products by incorporating 443 thousand independent consultants, who sell 5.8 billion pesos annually.

“We believe that Jafra has significant growth potential ahead through its digital transformation, which will be accelerated by leveraging our scale and infrastructure. We welcome the entire Jafra team to our company.”

The transaction includes both the Mexican and US operations of the German-based Vorwerk Group.

“Betterware expects the acquisition to be highly additive from year one. The acquisition is expected to add approximately $0.34 per share to EPS in 2022 and more than $46 million to EBITDA, not considering any identified cost synergies.

He detailed that the acquisition will be through a combination of debt financing of 225 million dollars and 30 million dollars of available cash.

“After the transaction, Betterware will continue to have a strong balance sheet and a low leverage ratio of 1.4 times, which will allow the company to also invest to support its growth and continue to pay its quarterly dividend of 9.38 pesos per share”, he added.

He added that the talks for the purchase started from the second quarter of 2021.

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