LVMH Acquires Cosmetics Maker Hard Candy
In an unlikely combination of “Hick” meets haute couture, French luxury goods purveyor LVMH Moet Hennessy Louis Vuitton has acquired Hard Candy, a Beverly Hills-based cosmetics maker known for its edgy marketing, street style and wildly colored, weirdly named nail polish.
Terms of the deal were not disclosed, but Hard Candy’s 26-year-old founder, Dineh Mohajer, will remain a minority shareholder and creative force in the firm. LVMH has signed her to a five-year contract to help grow and diversify the company, which posted $10 million in sales last year.
Started in Mohajer’s bathroom sink in 1995, Hard Candy shook up the stodgy cosmetics industry almost overnight with offbeat polish colors with names such as Trailer Trash, Hick and Shag. But Mohajer said skyrocketing sales left her struggling to manage the company’s explosive growth. She said she’s happy to be relinquishing operational and management concerns to get back to her specialty of creating and marketing new products.
“It’s a tremendous relief for me,” Mohajer said. “Their support and resources will allow me to focus on the things I do best.”
LVMH is an international powerhouse known for a stable of luxury brands that includes Louis Vuitton leather goods, Dom Perignon champagne, Christian Dior perfume and Givenchy fashions. Sales topped $8 billion last year, but the company’s profit slumped 29% due in part to the Asian crisis that has tempered demand for its ultra-high-end goods.
Pierre Mallevays, director of acquisitions for LVMH, said Hard Candy will help the company gain a toehold in the U.S. market while helping it appeal to younger buyers.
“We’re broadening our product line to include Generation X consumers,” Mallevays said. “Which doesn’t mean our other products are suffering from the grandma syndrome. We just want to cover a broader segment of the market.”