Billionaire Dennis Bastas buys out cosmetics brand MCoBeauty at $1b valuation
Billionaire Dennis Bastas has taken full control of MCoBeauty. The deal values the company at $1b. This follows DBG Group’s 50 per cent stake acquired in 2022.
Transaction snapshot
Deal value: At least $500m
Deal multiples: ~3.3x
Deal type: Acquisition of remaining 50% stake
Investors: DBG Group
MCoBeauty was founded in 2020 by Shelley Sullivan. The company makes affordable dupes of premium cosmetics and skincare products. Its items are sold in supermarkets and chemists.
DBG Group’s early investment helped boost growth. Last year, MCoBeauty products were launched in 1,800 Kroger supermarkets in the United States. In February, the range was introduced in 1,200 Target stores. Revenue is expected to reach $300m this financial year, with Europe next on the agenda.
As part of the deal, Ms Sullivan will step down as chief executive. MCoBeauty will join VidaCorp, the beauty arm of DBG Group. The portfolio also includes Nude by Nature and Makeup Cartel, which was acquired for about $60m last year.
Ms Sullivan said DBG Group allowed her to run the business in a fast-paced, entrepreneurial way. She expressed pride in building a brand that has taken market share from global giants such as L’Oréal, Rimmel, and Maybelline. MCoBeauty is the bestselling beauty brand in Woolworths and Big W, with 40 of Woolworths’ top 50 beauty products coming from its range.
The company has faced legal challenges, having settled two lawsuits out of court. When MCoBeauty products launched in Target stores, British brand Charlotte Tilbury criticised the dupe strategy. Ms Sullivan said the reaction reflected a tough market, where premium brands are under pressure.
After exiting MCoBeauty, Ms Sullivan will join Creative Artists Agency in Los Angeles. She may create brands outside the beauty industry. Toby Borg from CAA praised her success in outgrowing some of the biggest names in the beauty space.
