LG bought Avon Products Japan
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South Korean cosmetics and household goods maker LG Household & Healthcare says an affiliate will buy a Japanese cosmetics firm for ¥10.5 billion (US$97.6 million).
Ginza Stefany Inc, based in Japan, will take a 100 per cent stake of Avon Products, founded in 1968.
The company’s sales reached KRW100 billion ($93 million) in it latest fiscal year.
The acquisition is the Korean cosmetics giant’s latest move to strengthen its foothold in Japan after buying Ginza Stefany in 2012 and Everlife the following year, reports Yonhap News Agency.
“Based on Avon’s credibility in Japan and its five decades of relationships with local companies, LG Household & Healthcare would like to overcome possible obstacles in expanding business there,” says the company.
Meanwhile, LG has had record earnings for this year’s first quarter. Its new profit of KRW196.4 billion was 8.8 per cent up from a year earlier. Sales rose 6.5 per cent to reach KRW1.7 trillion, and operating profit was up 9.2 per cent to KRW284 billion.
On the back of the robust earnings, the company says it will invest KRW389.3 billion by March 2020 to expand its production lines and build a logistics centre in Cheongju, central South Korea.
Questions & Answers
Q.Which company is directly purchasing Avon Products Japan?
Which company is directly purchasing Avon Products Japan?
Ginza Stefany Inc, a company based in Japan, will acquire a 100 per cent stake in Avon Products. Ginza Stefany Inc is an affiliate of LG Household & Healthcare.
Q.What is the primary reason LG Household & Healthcare gives for this acquisition?
What is the primary reason LG Household & Healthcare gives for this acquisition?
The company aims to use Avon’s established credibility and long-standing relationships with Japanese companies. This strategy is intended to help overcome potential obstacles in expanding its business in Japan.
Q.How much did Avon Products Japan report in sales for its latest fiscal year?
How much did Avon Products Japan report in sales for its latest fiscal year?
Avon Products Japan had sales of KRW100 billion, which is equivalent to approximately $93 million, during its most recent fiscal year.
Q.Has LG Household & Healthcare made other acquisitions in Japan recently?
Has LG Household & Healthcare made other acquisitions in Japan recently?
Yes, this acquisition is the latest in a series of moves to strengthen its presence in Japan. LG Household & Healthcare previously bought Ginza Stefany in 2012 and Everlife the following year.