Hindustan Unilever, a leading consumer goods giant, has agreed to acquire beauty startup Minimalist for approximately $342 million, marking its latest push to expand in India's fast-growing premium skincare market.

The acquisition, which was confirmed by a statement on Tuesday, will see Hindustan Unilever initially acquire a 90.5% stake in Minimalist through secondary buyouts and primary investment, with the remaining 9.5% to be purchased from founders in two years. This deal gives Unilever's Indian unit a stronger foothold in the premium beauty segment, adding to its portfolio that includes brands like Dove, Pond's, and Lakmé.

Minimalist, known for its actives-led skincare products, has reported an annual revenue run rate of over 5 billion rupees and has been profitable since its inception in 2020. The startup, founded by Mohit Yadav and Rahul Yadav, sells a range of products from sunscreen to hair-repair serum and has built a strong presence in e-commerce. Hindustan Unilever plans to complement this online presence by expanding the brand's offline distribution using its extensive retail network.

The acquisition is part of Hindustan Unilever's strategy to grow its Beauty & Wellbeing portfolio in the high-growth masstige beauty segment. "This acquisition is another key step to grow our Beauty & Wellbeing portfolio in the high growth masstige beauty segment," said Rohit Jawa, CEO of Hindustan Unilever, in a statement.

This deal follows Hindustan Unilever's expansion into health and well-being through the purchases of Oziva and Wellbeing Nutrition last year. The latest transaction is expected to close in the June quarter, subject to regulatory approvals. The founders of Minimalist will continue to run the business for two years after the deal closes.

The acquisition values Minimalist higher than the roughly $300 million valuation it reportedly sought when attempting to raise venture capital in the second half of last year, according to previous media reports. This deal highlights the growing demand for premium skincare products in India, where the beauty and personal care market is currently valued at 680 billion rupees.

India's beauty and personal care market remains significantly underpenetrated compared to developed markets, with per capita spending at just a fraction of countries like the US and China, according to Hindustan Unilever's presentation. This acquisition is expected to further boost the growth of the premium skincare market in India, with Hindustan Unilever's extensive retail network and resources set to complement Minimalist's online presence.

The deal is a significant milestone for India's startup ecosystem, with Minimalist becoming one of the largest acquisitions in the beauty and personal care space. The acquisition is also expected to create new opportunities for innovation and growth in the premium skincare segment, as Hindustan Unilever and Minimalist work together to expand their offerings and reach new customers.