Korean vegan makeup brand Dear Dahlia on the market

Dear Dahlia, a South Korean vegan makeup brand that operates around 300 stores across the globe, has been put on for sale for more than 100 billion won ($75.5 million), according to banking sources on Friday.

Korean and overseas private equity firms and cosmetics companies are considering buying a majority stake in Baram International Co., the beauty brand operator.

Dear Dahlia was valued at more than 100 billion won last September when it attracted 16.5 billion won in capital. The cosmetics brand has drawn a combined 42.5 billion won via funding since its inception in 2017.

The existing shareholders, institutional investors holding a combined 60.48% stake, aim to divest of their shares. The company’s founder and Chief Executive Ray Park holds the remaining 39.52%.

Among the institutional investors are Mirae Asset Securities Co., the second-largest investor with a 14.69% stake, LB Investment Inc. with 7.28%, Amorepacific Group holding 5.81%, Smilegate with 5.36% and JS Corporation holding 3.36% as of end-2022, according to its latest financial statement.

CEO Park will maintain his holdings and help a new owner manage the firm, sources said.

The beauty brand has highlighted its vegan makeup products since 2017 when the awareness of such cosmetics, which don’t contain animal-derived substances and are not tested on animals, was still low in Korea.

The brand highlights flowers and gardens in the imagery and marketing of its makeup products to emphasize the natural ingredients. 

Dear Dahlia is also well known as a mid-sized cosmetics brand that entered global markets in its early days. In 2019, the brand opened a boutique in Galeries Lafayette, one of the largest department stores in Europe, and in the same year also entered the US department store chain Neiman Marcus.

In 2022, the beauty brand advanced into Douglas, a leading cosmetics chain in Europe, to expand its presence in Italy, Germany, Spain and Belgium.

Dear Dahlia also boosted sales in the Middle East, ranking second in Faces United Arab Emirates last year in terms of makeup product revenue. Faces is a leading cosmetic product chain in the Middle East, operating around 80 stores across the region.

The Korean beauty brand posted an 11 billion won operating loss and 20.1 billion won in revenue in 2022. It aims for an initial public offering in the mid to long term.

Write to Ji-Eun Ha at hazzys@hankyung.com

Jihyun Kim edited this article.