Hindustan Unilever Acquires 90% Stake in Minimalist for ₹2,955 Crore
Acquisition of Minimalist
FMCG major Hindustan Unilever Limited (HUL) has announced the acquisition of a 90.5% stake in skincare startup Minimalist for ₹2,955 crore. The company made the announcement while releasing its quarterly results on January 22.
Details of the Deal
HUL will acquire the 90.5% stake in Minimalist through secondary buyouts and a primary capital infusion at a pre-money enterprise value of ₹2,955 crore. The deal is subject to adjustments as per the transaction document. The company will buy the 90.5% stake from existing investors, including Peak XV Partners and others. The remaining 9.5% stake will be acquired from the founders in two years as per the terms set out in the transaction documents.
Minimalist's Growth
Minimalist, founded by brothers Rahul Yadav and Mohit Yadav, has seen its valuation increase from approximately ₹630 crore (about $75 million) to ₹3,000 crore ($350 million) in about three years, driven by increasing revenues and a stable profit profile. This is one of the largest deals in the direct-to-consumer (D2C) space in recent years, particularly in the skincare industry. In FY24, Minimalist generated a revenue of ₹350 crore, a 89% increase from ₹184 crore in FY23. During the same period, its profit more than doubled from ₹5 crore to ₹11 crore. Minimalist has been profitable for at least four years, according to reports.
Financial Discipline
Based on its FY24 numbers, Minimalist has commanded a revenue multiple of about 10X, which is significantly higher than the 4-6X that similar direct-to-consumer (D2C) startups typically get during similar deals. This premium is largely attributed to its financial discipline. About three years ago, Minimalist raised ₹110 crore ($15 million) from Unilever Ventures, the venture investing arm of Unilever, and others to scale its business.
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