US private equity firm Blackstone Inc. is pursuing the acquisition of Juno Hair, South Korea’s largest premium hair salon chain, in a deal that values Juno Hair Group at 800 billion won ($590 million), people familiar with the matter said on Wednesday.
Blackstone is the most aggressive among several global buyout groups that have explored a potential takeover of the Korean beauty group, sources said.
Although no memorandum of understanding has yet been signed, Blackstone has conveyed its intention to build the Juno Hair chain into “one of the world’s largest salon franchises,” according to a person close to the negotiations.
KPMG Samjong Accounting Corp., also known as Samjong KPMG, is managing the transaction.
Blackstone is a US private equity firm (Courtesy of the Times of Israel) Investment banking sources said that Blackstone hopes to buy the entire stake in Jun Hair held by founder and Chief Executive Kang Yun-seon and related parties.
However, it remains under discussion whether Kang will retain a minority stake and stay involved in the management of the company following a deal, they said.
If the deal goes through, the transaction would mark one of the largest buyouts of a consumer service brand in Korea’s fragmented beauty sector, which has historically lacked scalable franchising models.
Founded in 1982 near Sungshin Women’s University in Seoul, Juno Hair has grown into a dominant force in the country’s personal care market with more than 180 salons and over 3,000 employees.
Its portfolio includes bridal beauty flagship Avenue Juno in the upscale Cheongdam district, the in-house training institute Juno Academy and the proprietary haircare line Tria Milia.
VALUATION EXCEEDS 20 TIMES JUNO’S EBITDA
The Juno Hair Group – comprising five entities, including Juno Beauty and Juno Depot – reported about 300 billion won in sales revenue last year with 37 billion won in earnings before interest, taxes, depreciation and amortization (EBITDA).
The proposed valuation represents an enterprise multiple exceeding 20 times EBITDA, a premium level rarely seen in Korea’s salon franchise industry, industry officials said.
Juno Hair is South Korea’s largest premium hair salon chain The valuation is comparable to that of global salon brands, such as Vidal Sassoon.
“This is a highly unusual valuation multiple, given the size and maturity of the domestic market,” said a Seoul-based M&A adviser. “Blackstone appears to be betting on its international scalability.”
KOREA’S VIDAL SASSOON
People close to the deal said the US buyout giant sees the acquisition as a springboard for the Korean beauty group’s international expansion.
CEO Kang is known to have been vocal about turning Juno into “Korea’s Vidal Sassoon.”
Juno Hair (Screenshot captured from its website) Juno has earned a reputation for its internally developed talent pipeline, which relies on its own academy to train hundreds of new stylists annually.
With most outlets operated directly rather than through franchises, the group is seen as having solved the long-standing industry issue of service inconsistency across locations, according to industry watchers.
Kang, known for taking her entire staff to the UK for training in 1993, is said to have emphasized education and professional standards to meet customer requests.
The internal discipline has been central to the brand’s premium positioning –and a key attraction for Blackstone, sources said.
EXPORT OF KOREAN HAIR SALON CULTURE
Sources said Kang’s current focus is on international expansion.
Juno already operates salons in the Philippines and Singapore, but Blackstone’s capital and global network could accelerate Juno’s growth into Southeast Asia, the Middle East and North America.
Juno Academy (Screenshot captured from its website) Juno’s Philippines outlet, which opened last year, is staffed by 20 stylists, generating 2 billion won in sales with 1 billion won in operating profit, sources said.
Further, Juno’s flagship Myeongdong branch in central Seoul draws mostly foreign tourists, fueling Kang’s belief that Korean salon culture can be exported globally.
For Blackstone, the deal would be a continuation of its strategy to back Korean mid-sized companies with strong cross-border growth potential.
The firm took a similar approach when it acquired JJTools, a precision cutting toolmaker, betting on its overseas expansion.
Write to Da-Eun Choi and Jong-Kwan Park at max@hankyung.com In-Soo Nam edited this article.
