Hong Kong-based CLSA to invest $36.6 mn in K-Beauty pioneer Jungsaemmool Beauty

Hong Kong-based private equity firm CLSA Capital Partners Ltd. has been picked as a preferred bidder to invest 50 billion won ($36.6 million) in Jungsaemmool Beauty, a South Korean cosmetics brand founded by one of the country’s first-generation makeup artists, according to sources in the investment banking industry on Friday.

The deal comes just two days after news of Blackstone Inc.’s bid for Juno Hair, Korea’s largest premium hair salon chain, underscoring the rising appeal of Korean beauty firms to global investors.

The CLSA investment deal values Jungsaemmool Beauty at 300 billion won, representing an enterprise multiple exceeding 15 times the earnings before interest, taxes, depreciation and amortization (EBITDA).

In 2024, the Korean cosmetics company posted 12.1 billion won in operating profit on sales of 110 billion won. Its EBITDA is estimated at 20 billion won.

With the latest investment, the company will step up its expansion into overseas markets, especially in the US, tapping into the global K-Beauty boom that continues to attract multinational investors. It also plans to launch a new product lineup.

Jungsaemmool Beauty operates over 1,300 shops across about 200 countries, including South Korea.

ONE OF K-BEAUTY PIONEERS


Its founder, Jung Saem-mool, is one of Korea’s first-generation makeup artists and is credited with popularizing the glass skin aesthetic, a hallmark of Korean makeup style.

A fine arts major turned makeup artist, Jung opened a prestigious beauty salon, called Jung Saem Mool Inspiration, in 1997 with Yoo Min-seok – her husband and chief executive of Jungsaemmool Beauty. Her clients include Korean top actresses such as Song Hye-kyo and Jun Ji-hyun, as well as Chinese star Tang Wei.

In 2015, she launched Jungsaemmool Beauty, where she leads product development and promotion. The Essential Skin Nuder Cushion, one of the company’s best-selling products, is known as the makeup that sells every 20 seconds.

CEO Yoo controls 72.49% of Jungsaemmool Beauty’s equity through Promacos Co., a cosmetics company. The remaining 27.51% has been held by Diamond Head Capital Pty Ltd., a Sydney, Australia-based private equity firm, since 2021.

DEEPER PENETRATION INTO KOREA


CLSA Capital Partners is said to be seeking to form a project fund, not a blind fund, with Korean limited partners to invest in Jungsaemmool Beauty.

The alternative investment management arm of CLSA Ltd., which manages $5 billion in assets, is expected to further expand its presence in Korea’s investment banking sector with the upcoming funding activity.

In 2014, the PE firm also set up a 300 billion won fund with Korea’s largest institutional investor, the National Pension Service (NPS), to back the global push of Nexen Tire Corp., Korea’s third-largest tire producer.

CLSA is a wholly-owned subsidiary of CITIC Securities Co., the largest securities company in China.

CLSA Capital Partners focuses on mid- and long-term investment in private companies, aligning with Jungsaemmool Beauty’s goal of securing funding to drive global expansion while minimizing stake dilution.

The investment deal is led by Deloitte Anjin LLC, which has emerged as a key player in Korean cosmetics deals in recent years.

Write to Da Eun Choi at max@hankyung.com

Sookyung Seo edited this article.