Shares in health and beauty company Olaplex Holdings (OLPX) bounced over 50% higher in pre-market trading today after it was bought by German consumer goods giant Henkel for $1.4 billion.
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Olaplex, whose haircare products are used by professional hairdressers, stylists and consumers, said Henkel was buying it for $2.06 a share in a cash transaction. That represents a premium of around 55% over Olaplex’s closing stock price on March 25 and 45% higher than the volume weighted average price of its shares for the last 30 trading days.
The company said it would continue to operate under the Olaplex name and brand but it will no longer be listed on the Nasdaq stock exchange. In addition, private equity group Advent International will fully exit its investment in the group. It has backed the group since 2019.
New Avenues for Innovation
Olaplex and Henkel said the deal would:
- Unlock new avenues for innovation through advanced technology, expanded capabilities and accelerated product development
- Bring together Olaplex’s broad North American direct-to-consumer and specialty retail presence with Henkel’s international footprint, leading to expanded international presence
- Create opportunities for innovation and growth across demographics and hair needs.
The transaction is expected to be completed in the second half of this year.
Earlier this month, Olaplex said Q4 net sales were $105.1 million, up 4.3% year over year, led by strong holiday performance across professional and direct to consumer channels.
Is OLPX a Good Stock to Buy Now?
On TipRanks, OLPX has a Hold consensus based on 2 Buy, 6 Hold and 1 Sell ratings. Its highest price target is $2.50. OLPX stock’s consensus price target is $1.83, implying a 37.59% upside.
