Mergers and Acquisitions in the Consumer Sector: L Catterton's Strategic Investment

Mergers and Acquisitions: A New Chapter for Stenders

In a significant move within the consumer sector, US private-equity firm L Catterton has successfully acquired a majority stake in the Chinese-owned Stenders, a company renowned for its bath and body care products.

This investment reflects L Catterton's confidence in the current market landscape, particularly amid a consumption decline in mainland China.

Investment in a Promising Market

• L Catterton's Asia fund has made four investments in China over the last 12 months, totalling US$200 million.
• Scott Chen, Asia managing partner at L Catterton, highlighted the potential for growth despite recent challenges, stating that “the time is ripe”.
• Stenders has shown remarkable annual growth, with sales rising approximately 20% over the past four years.

The acquisition of Stenders showcases L Catterton's strategy to capitalize on premium brands, particularly those emphasizing well-being. This aligns with industry trends focusing on higher quality consumer products.

The Future of the Consumer Sector

As consumer preferences shift towards natural and premium offerings, the segment's expected growth is significant. China's bath and body care market is projected to reach around US$1.2 billion by 2028.

With increasing consumer savings expected to influence spending behavior post-economic uncertainties, there is optimism regarding future investments in the consumer sector.

Stenders, originally founded in Riga, Latvia, has evolved significantly under its previous ownership. As it transitions to L Catterton, the brand aims to innovate and expand its market reach.