VLCC to Buy UAE Grooming Company

VLCC, the Indian wellness chain, is about to acquire UAE’s The Grooming Company (TGC) for Rs 150 crore ($32.4 million), which will help the company break into the Middle East’s lucrative grooming space.

VLCC operates only fitness centres, numbering 14, in the UAE. The beauty chain’s acquisition will help the company foray into the hair and nail treatment category in a key market — the Middle East contributes 40 per cent of overall revenues — where the grooming space is seeing an unprecedented boom, growing at over 12 per cent annually.

The transaction will be funded through internal accruals and debt and will be done in phases, according to sources who were quoted in a report in The Economic Times.

A VLCC spokesperson had no comment on the development while TGC executives could not be reached.

TGC, founded by Arabic investor Negin Fattahi Dasmal in the late 1990s, owns high-end brands such as N-Bar, 1847, JetSet, and Tilia & Finn. N-Bar is a chain of nail treatment salons while 1847 comprises grooming lounges for men. JetSet is ‘wash and blow dry’ hair-care concept and Tilia & Finn is a beauty lounge that combines grooming and beauty services under one roof.

These outlets have helped TGC to net annual revenues of around $40 million from the UAE cosmetics and personal care market, estimated to be worth over $1 billion and growing at over 20 per cent a year. TCG, which employs around 800 people, is spread across the UAE and Lebanon and will shortly launch in Kuwait and Qatar.

Research and advisory firm Ernst & Young is advising VLCC on the transaction, said the source.

Post-acquisition, VLCC plans to bring the TGC concepts to India and open at least 75 such outlets here over the next two years by investing around Rs 100 crore. The company is targeting revenues of Rs 200 crore through the acquisition in India, whose cosmetics industry too is teeming with a 25 per cent yearly growth due to the increasing consciousness over personal appearance in a growing economy.

VLCC, which has an overall turnover of over Rs 500 crore, runs a chain of fitness centres and day spas, besides selling a range of personal care products across the country. At present, it has 225 slimming centres in India.

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