- Bieber retains founder role at Rhode.
- Deal includes $800 million in cash and stock.
- Potential $200 million earnout based on performance.
Market reaction & context
The acquisition of Rhode supports Elf Beauty’s strategy to expand in the premium beauty segment, targeting higher-income consumers. This move aligns with industry trends favoring wellness-focused and influencer-driven brands. Elf shares closed up 3% following the announcement, signaling investor optimism regarding the integration of Rhode’s strong brand recognition.
Detailed analysis
Elf Beauty will pay Rhode shareholders $800 million in cash and stock, with an additional performance-based earnout of $200 million, reflecting Rhode’s rapid growth since its 2022 launch. The company has become notable for its innovative product lines aimed primarily at Gen Z consumers.
“Through this acquisition, we aim to bring rhode to more spaces, places, and faces globally,” said Bieber, who will continue in her role as founder and creative director.
Outlook / management quote
The acquisition is expected to enhance Elf’s portfolio by leveraging Bieber’s influence and Rhode’s existing customer base. Analysts note that this deal positions Elf to compete more effectively against established brands in the premium beauty space, potentially driving revenue growth in coming years.
Conclusion
As the beauty industry continues to evolve, Elf’s acquisition of Rhode is indicative of a broader trend towards consolidation among beauty brands, especially those with strong social media presence and high consumer engagement. Investors will be closely monitoring the integration process and Rhode’s performance metrics to assess the deal’s long-term impact.
No investment advice. For informational purposes only.
References
1 Hailey Bieber sells makeup brand Rhode to Elf Beauty in $1 billion deal. Reuters. Retrieved October 6, 2023.
2 e.l.f. Beauty Announces Definitive Agreement to Acquire rhode. Elf Beauty. Retrieved October 6, 2023.
3 Hailey Bieber Strikes $1 Billion Deal to Sell Rhode to e.l.f. Beauty. Hollywood Reporter. Retrieved October 6, 2023.
4 E.l.f. Beauty to acquire Hailey Bieber’s rhode in $1 billion deal. CNBC. Retrieved October 6, 2023.
5 e.l.f. Beauty buys Hailey Bieber’s Rhode skincare brand for $1 billion. People. Retrieved October 6, 2023.
6 Beauty powerhouse e.l.f. snaps up Hailey Bieber’s Rhode in $1B. Fox Business. Retrieved October 6, 2023.
7 E.l.f. Acquires Hailey Bieber’s Rhode for $1 Billion | BoF. Business of Fashion. Retrieved October 6, 2023.
8 e.l.f. Beauty buys Hailey Bieber’s Rhode skincare brand for $1 billion. Fortune. Retrieved October 6, 2023.
9 Hailey Bieber Sells Rhode to e.l.f. Beauty for $1 Billion – E! Online. E! Online. Retrieved October 6, 2023.
10 Rhode: Hailey Bieber’s makeup brand sold to e.l.f. in $1bn deal. BBC News. Retrieved October 6, 2023.