Macy’s announced Feb. 3 that it has signed an agreement to acquire Bluemercury—the large and fast-growing luxury beauty-products and spa-services retailer—for $210 million in cash. The transaction is expected to be completed in Macy’s fiscal first quarter, which ends on May 2, 2015, and be accretive to Macy’s earnings in its first full year (fiscal 2016).
Currently, Bluemercury, based in Washington, D.C., operates 60 specialty stores in 18 states—typically in prime street-level locations and urban-lifestyle centers, as well as an online business.
Products include well-known, high-end luxury beauty brands, as well as M-61, a proprietary skincare brand—all supported with personalized assistance from a team of beauty experts with a high level of technical product knowledge. Most locations include in-house spas.
Bluemercury will continue to be led by Marla Malcolm Beck and Barry Beck, the husband-and-wife team who co-founded the company in 1999.
Its team of about 500 associates will remain in their current roles operating as a stand-alone Bluemercury specialty business.
“Beauty is a core signature business for Macy’s and Bloomingdale’s, and a continued platform for our company’s profitable sales growth," said Terry J. Lundgren, Macy’s chairman and CEO. "With Bluemercury, our company can access a new channel to reach additional customers, add new dimensions to our product offering and apply our expertise in omnichannel retailing. Our plan is to operate and significantly expand Bluemercury stores as a stand-alone business with an enhanced omnichannel component for a seamless customer experience across stores, online and mobile. Concurrently, we also plan to add selected Bluemercury products and boutiques to Macy’s stores nationwide.”
Marla Malcolm Beck, Bluemercury’s CEO and president, stated, “We are excited to continue our aggressive expansion of Bluemercury, while simultaneously leveraging Macy’s leadership in omnichannel technology, supply chain and retail operations. Keeping Bluemercury as a stand-alone business while adding new expertise will enable us to fulfill our mission of being the best at giving beauty advice and helping our customers make their way through the often complex process of purchasing beauty products.”
Barry Beck, Bluemercury’s COO, added, “With the full weight of Macy’s resources, we will be able to accelerate our store penetration across the United States, bringing our specialty-store format to urban and suburban markets throughout the country. We are thrilled to team up with Macy’s in this next chapter of our growth, and we especially want to thank The Invus Group, which has been a great partner since 2006.”
Within Macy’s, Bluemercury will report directly to Lundgren. Marla Malcolm Beck will continue as Bluemercury’s CEO and president. Barry Beck will continue as Bluemercury’s COO.
Macy’s was advised in the transaction by Credit Suisse Securities (USA); and Jones Day. Bluemercury was advised in the transaction by Goldman, Sachs & Co.; Patterson Belknap Webb & Tyler; and Cooley.
[Logo courtesy of Macy's]