Gryphon to take majority stake in Milani Cosmetics

Gryphon Investors will acquire a majority stake in Los Angeles-based cosmetics brand Milani Cosmetics. No financial terms were disclosed. Milani’s current owners Ralph Bijou and Laurie Minc will retain “significant” minority stakes in the company moving forward. The deal is expected to close next month. Moelis & Company LLC was financial adviser to Milani on the transaction while Financo did likewise for Gryphon.

PRESS RELEASE

May 18, 2018 (San Francisco) – Gryphon Investors (“Gryphon”), a San Francisco-based middle market private equity firm, announced today that it will acquire a majority stake in Milani Cosmetics (“Milani” or “the Company”), a leading family-owned “masstige” beauty company that encompasses two distinct brands, Milani and Jordana. Current owners Ralph Bijou and Laurie Minc will hold significant minority stakes alongside Gryphon. The transaction, which is expected to close next month, is subject to customary closing conditions. Terms of the deal were not disclosed.

As part of the transaction, Michelle Taylor will become interim CEO. Ms. Taylor is a Gryphon Executive Advisor and an accomplished senior executive in the cosmetics and beauty businesses who has held senior leadership positions at Kate Somerville Skincare, Kiehl’s, Lancôme, L’Oréal USA, Chanel, Elizabeth Arden, and others. Ms. Taylor, along with Gryphon Partners Dennis O’Brien and Keith Stimson, and Gryphon Principal Matt Farron, will join the Board of Directors. Ralph Bijou will continue with the Company as President of Jordana Cosmetics and Laurie Minc will continue with Milani as a Senior Advisor. Both Ralph Bijou and Laurie Minc will be on the Board of Directors. The transaction marks Gryphon’s first investment in the beauty sector.

Mr. O’Brien said, “Gryphon has long been exploring the $45 billion beauty and personal care space and is excited to commit to the industry. Leveraging Michelle’s deep knowledge of the sector, we believe we have identified a strong growth platform in Milani, one which has a variety of proven and developing sales channels and the opportunity to reach a broad and growing consumer base that has discovered Milani’s quality and is actively seeking out the brand. We look forward to working with Michelle, Ralph, and Laurie to build upon the company’s proven success.”

Milani, headquartered in Los Angeles, is a market leader in the cosmetics industry. The company began with the creation of Jordana Cosmetics in 1986 and grew with the purchase and relaunch of Milani in 2001. Milani products are primarily manufactured in the U.S. and Italy. The company’s face, lip, and eye products are available in 75 countries and through key domestic retail partners including Walmart, Walgreens, Ulta, Target, and CVS.

“We are delighted to partner with the team at Gryphon to help realize our dream of developing Milani into a great global name, enjoyed by women everywhere,” said Mr. Bijou and Ms. Minc. “Gryphon’s long-standing track record building consumer product brands, experience with family-owned businesses, and their beauty and channel experts were all critical considerations for us. They share our enthusiasm for our company, and their resources will ensure our ability to continue to deliver a world-class brand to our consumers for generations to come.”

Mr. Farron added, “Milani has a history of bringing to market innovative products that are responsive to customer needs and fast-moving consumer trends. As one of the few remaining large, scalable, independent mass beauty brands, the Company is well positioned to drive growth through product development and strong relationships with its retail and manufacturing partners.”

Ms. Taylor noted, “Milani is the ‘masstige’ brand of choice for consumers who seek out innovative, high quality makeup at affordable prices. That reputation has driven the Company’s rapid growth both internationally and domestically, where it was one of the fastest growing mass brands in the U.S. over the past year. Gryphon’s expertise and financial resources will be key as Milani looks to expand its market presence in an ever-changing and keenly competitive landscape.”

Moelis & Company LLC was financial advisor to Milani, and Sheppard, Mullin, Richter & Hampton was legal advisor to the Company and its owners. Financo acted as Gryphon’s financial advisor and Kirkland & Ellis as the firm’s legal advisor.

About Milani Cosmetics
Milani, headquartered in Los Angeles, is a market leader in the cosmetics industry, best known for its top quality products for women of all skin tones and beauty goals. The company began with the creation of Jordana Cosmetics in 1986 and grew with the purchase of Milani in 2001. Milani products are primarily manufactured in the U.S. and Italy. The company’s face, lip and eye products are available in 75 countries and through key domestic retailer partners including Walmart, Walgreens, Ulta, Target and CVS. Please visit www.milanicosmetics.com for more information.

About Gryphon Investors
Based in San Francisco, Gryphon Investors (www.gryphoninvestors.com) is a leading private equity firm focused on profitably growing and competitively enhancing middle-market companies in partnership with experienced management. For 23 consecutive quarters, Gryphon has been ranked in Preqin’s prestigious quarterly PE report as one of North America’s top-decile buyout firms based on consistency of strong investment returns. Managing over $4 billion of equity investments and capital since 1997, the firm has an extensive track record of leading equity investments of $50 million to $200 million per portfolio company with sales ranging from approximately $100 million to $500 million. Gryphon prioritizes investment opportunities where it can form proactive partnerships with owners and executives to build leading companies, utilizing Gryphon’s capital, specialized professional resources, and operational expertise. Gryphon closed its fourth private equity buyout fund, Gryphon IV, L.P., in November 2016 at $1.1 billion, and raised a $100 million captive mezzanine fund, Gryphon Mezzanine Partners, L.P., in August 2017.