The founders of Swedish cosmetics company Oriflame have made an offer to buy out the shares of the company they do not own, valuing the company at 12.9 billion crowns ($1.3 billion).
According to a report in Reuters, Oriflame primary owners the af Jochnick family has made a cash offer of 8.89 billion crowns (227 crowns per share) to the remaining shareholders, a 35% premium on the 168.35 crown closing price for Oriflame’s stock on May 20, 2019. After the offer, shares increased 34% in opening deals.
Oriflame sells its makeup, skin care and hair care products through a direct-selling model in 60 countries. Over the last few years, the company has reduced its presence in Russia and other Eastern European and Near Eastern countries. It has also seen a decrease in activity in Asia and Turkey.
In a statement, the family said the company “needs to undertake a repositioning in key geographies, and [that] achieving this repositioning has challenges in the public market.” They continued: “We have therefore chosen to make an offer for the shares in the company that the family does not already own, in order to enable Oriflame to achieve this repositioning with the benefit of private ownership.”
In a separate statement, Oriflame said that independent board members had formed a bid committee—without af Jochnick family board members—that would evaluate the offer and announce its opinion no later than two weeks before the expiry of the acceptance period.