Hindustan Unilever Acquires 90% Stake In Skincare Brand Minimalist For Rs 2,955 Crore

FMCG giant Hindustan Unilever Limited (HUL) has announced the acquisition of a 90.5 percent stake in the skincare startup, Minimalist, for Rs 2,955 crore in an all-cash transaction. This acquisition, one of the most significant in the direct-to-consumer (D2C) sector, is slated to be finalized by the end of the June quarter of 2025.

The acquisition by HUL will be executed through a combination of secondary buyouts and primary capital infusion, valuing the company at a pre-money enterprise value of Rs 2,955 crore. The adjustments specified in the transaction agreement will further refine the deal.

Existing investors, such as Peak XV Partners, along with others, will decrease their holdings in Minimalist as HUL moves to acquire its substantial stake. Founders Rahul Yadav and Mohit Yadav currently hold a majority stake of approximately 61 percent, with Peak XV Partners following as the second-largest shareholder, possessing a 27.4 percent stake. Twenty Nine Capital owns around 5.6 percent, while the remaining interest is held through Employee Stock Ownership Plans (ESOPs).

HUL plans to acquire its 90.5 percent share by the end of the June quarter in 2025 (Q1FY26), with the remaining stake to be incrementally acquired over time.

Approximately three years ago, Minimalist had raised Rs 110 crore ($15 million) from Unilever Ventures, the venture arm of Unilever, in an effort to expand its business within India.

The current enterprise value indicates that the Yadav brothers are set to receive Rs 1,800 crore, while Peak XV Partners is poised to earn a considerable return of about 10 times their initial investment. Initially investing Rs 79 crore three years ago, Peak XV Partners will now gain Rs 895 crore.

Minimalist’s impressive financial discipline has significantly contributed to its high valuation. Over the previous three years, the company’s valuation has escalated from around Rs 630 crore ($75 million) to Rs 3,000 crore ($350 million), bolstered by increased revenues and a steady profit profile.

This acquisition ranks amongst the most substantial within the D2C space in recent years, particularly in the skincare sector.

In the fiscal year 2024 (FY24), Minimalist reported a revenue of Rs 350 crore, showing an 89 percent growth compared to Rs 184 crore in fiscal year 2023 (FY23). During this period, the company’s profit more than doubled from Rs 5 crore to Rs 11 crore. Notably, the company has been consistently profitable for at least the past four years.

This acquisition highlights HUL’s strategic expansion in the skincare industry and signifies a landmark deal in the evolving market for D2C brands. As consumer preferences adapt with the times, significant acquisitions such as this reflect a dynamic shift towards more digital and direct engagement in the consumer goods sector.