CCI Approves HUL’s Acquisition Of D2C Brand Minimalist

The Competition Commission of India (CCI) has approved FMCG giant Hindustan Unilever Ltd’s (HUL) proposal to acquire a majority stake in D2C personal care brand Minimalist. 

This comes about two months after HUL sought the competition watchdog’s approval for the acquisition of the D2C startup.

As per the agreement signed between HUL and Minimalist, the FMCG major will acquire a 90.5% stake in Minimalist parent Uprising Science for a cash consideration of INR 2,670 Cr at a pre-money enterprise valuation of INR 2,955 Cr. 

The acquisition would help HUL strengthen its beauty and personal care portfolio. Earlier this month, HUL parent Unilever’s new CEO Fernando Fernandez said that its Indian subsidiary is doing well and is facing headwinds only in the beauty segment due to “channel and segment development”.

Founded in 2020 by Mohit Yadav and Rahul Yadav, Minimalist sells skincare, haircare and bodycare products. It raised about $15 Mn before the proposed acquisition by HUL.

VC firm Peak XV Partners was one of the early backers of Minimalist and would make INR 800 Cr on its investment of INR 80 Cr in the startup.

Minimalist’s net profit zoomed 110% to INR 10.9 Cr in FY24 from INR 5.2 Cr in FY23. Revenue from operations surged 89% to INR 347.4 Cr during the year under review from INR 183.8 Cr, a year ago.

With D2C brands carving out their names in various segments and gaining a wide customer base, a number of established FMCG companies have been backing and acquiring these brands.

FMCG major Emami raised its stake in D2C men’s grooming brand The Man Company to 100% via an all-cash deal in August last year. Meanwhile, Marico acquired a 58% stake in D2C nutrition brand Plix for INR 369.01 Cr in 2023. Prior to that, it also bought a 60% stake for an undisclosed consideration in Just Herbs’ parent Apcos Naturals Private Limited in 2021.

At the heart of all these is India’s expanding D2C space, which is projected to become a $300 Bn market opportunity by 2030.