La Bouche Rouge, the premium French makeup label, faced a turning point when it was placed in receivership by the Paris Commercial Court in July. On October 3, the brand found a new owner in Beauty Brands Global, a recently established holding company based in Dubai, spearheaded by Dilesh Mehta, a prominent figure in the beauty industry and the chairman of Designer Parfums. Designer Parfums holds the fragrance license for Cerruti 1881 among its portfolio of brands.
Dilesh Mehta now stands as the sole shareholder of La Bouche Rouge, with support from interim manager Vincent Jeanniard. Vincent Jeanniard brings a wealth of beauty industry expertise, having worked with industry giants like L’Oréal, LVMH, and Burberry. He explains, «The Dubai holding company was set up for expediency due to La Bouche Rouge’s complex situation. A French-based company is also in the process of establishment.»
At the helm of this yet-to-be-named entity are Jean Mortier, former Coty executive, as chairman, and Florence Rollet, previously with Tiffany and Coty as General Manager France, serving as managing director. The founder of La Bouche Rouge, Nicolas Gerlier, will continue to contribute as an advisor and creative director.
Founded in 2017, La Bouche Rouge initially gained recognition for its lipsticks and later expanded its offerings to include complexion and eye makeup. The brand’s distinctiveness lies in its strong commitment to eco-responsibility, offering vegan formulas primarily crafted from natural ingredients and packaging that’s fully recyclable. It also prioritizes craftsmanship, producing containers in French workshops. In March, La Bouche Rouge ventured into fragrances.
Positioned in the premium segment, La Bouche Rouge swiftly made a name for itself in the fiercely competitive beauty industry. In 2020, it secured €2.5 million in funding from Bpifrance and several business angels. Two years later, it raised an additional €10 million from BpiFrance, the Swiss Mirabaud Lifestyle Impact & Innovation fund, and the Chalhoub group, a leading luxury goods conglomerate in the Middle East. This funding aimed to propel the brand’s international expansion, particularly in China.
However, by 2022, the brand reported sales of €3.7 million but faced losses of €6 million. Challenges included the impact of the COVID-19 pandemic, difficulties in establishing a presence in China, and substantial marketing expenses (around €2 million in 2022).
Vincent Jeanniard notes, «There was also a strategy of rapid and extensive store openings for a smaller brand that did not result in corresponding sales.» In early 2023, La Bouche Rouge claimed a presence in 80 points of sale worldwide.
Beauty Brands Global, in its acquisition of La Bouche Rouge, will inherit the brand’s formulation laboratory in Orléans and approximately fifteen employees. The company’s mission is to reevaluate the economic structure of La Bouche Rouge while preserving its core values, including product formulas, the «Made in France» ethos, and artisanal craftsmanship. Price adjustments, particularly for refills, are part of the plan.
The Paris Commercial Court favored Beauty Brands Global’s proposal over competing offers, including one from makeup brand Le Rouge Français and the Mirabaud fund, which had the backing of two former La Bouche Rouge employees.
In the future, Beauty Brands Global may explore opportunities to acquire or manage other cosmetic brands.
Vincent Jeanniard concludes, «The market is poised for change in the near future, as many brands with sales exceeding €5 million are grappling with cash flow issues, and funds are becoming increasingly cautious. Additionally, several major groups with extensive portfolios may opt to sell their brands.»
