Johnson & Johnson set to takeover Japanese skincare market

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Pharma Giant Johnson & Johnson (J&J) are set to swallow Ci:z, the Japanese skincare and cosmetics firm.   

In a move to really establish themselves within the Asian skin care market, J&J will shell out 230 billion Japanese yen ($2.05 billion) in cash to take over the share of Ci:z that they do not already own through their affiliate company Cilag GmbH International. In 2016 Cilag entered into a long-term strategic collaboration with Ci:z, to distribute their brands outside of Japan.

The acquisition will include the Company’s range of brands comprising Dr.Ci:Labo (Japan’s number 1 medical skincare brand), Labo Labo and Genomer.

While J&J’s once affluent babycare franchise suffers, their beauty brands (including Neutrogena) have boomed, surpassing their over-the-counter drug sales in 2017 and delivering $4.2 billion in worldwide sales — a jump of 7.8% from the previous year. This large spike in sales — which has continued in 2018 with beauty products turning over $2.2 billion in sales this year so far — has been driven by the strength of Dr.Ci:Labo.

“Health and beauty consumers are actively seeking science-based innovation to improve their skin,” said Jorge Mesquita, Worldwide Chairman, Johnson & Johnson Consumer. “This transaction will maximise value creation for Johnson & Johnson’s Consumer business by bringing in an agile innovation model and rapidly accelerating sales through our global commercialization expertise.”

The tender offer is expected to close in the first quarter of 2019.

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