The multifunctional beauty brand will issue 4.5 million shares of the company to merge with Hanbul Cosmetics, which is set to be effective from 1st May 2017.
Although It’s Skin will remain, the merger will result in the dissolution of the Hanbul Cosmetics, with the new company ‘Hanbul’ taking shape.
It’s Skin creates products with various properties including anti-stress, moisturisation, skin whitening capabilities/protection from UV, anti-wrinkle and nourishment to appeal to a range of consumer concerns.
The move will enable the cosmetics company to grow its existing presence throughout the globe, and particularly in China — a sizable beauty hub in APAC.
As part of the merger agreement, It’s Skin will also take responsibility for, and ownership of, Hanbul’s R&D centre and production facilities in both Korea and China including a plant currently being built in Huzhou, China.
Together, the absorption of these buildings will enable It’s Skin to further propel its research, development and manufacturing efforts in China and the wider APAC region.
Korean success is key
In August 2016, the skin care and make up name made strides towards expanding its K-beauty vision by opening a new store in Samcheong-dong, Seoul, South Korea.
The brand emphasised ‘The Korean contemporary’ concept to highlight the cosmetic capabilities of both its product and Korean influences such as K-beauty and K-pop.
By combining this message with the brand’s ‘Clinical Skin Solution’ image, the company aims to strengthen its identity as a company built on Korean tradition and culture and use this as a key message in its marketing and advertising.
"In a bid to emphasise its brand identity, the new store is “based on the concept of clarity and elegance," said Yoo Geun-jik, CEO of It’s Skin.
“Through this merger, Hanbul will become a leader in the industry by transforming itself into a comprehensive cosmetics company that will cover all aspects of R&D, manufacturing facilities, marketing, and sales,” added Yoo Geun-jik, CEO, It’s Skin.
Navigating geopolitical obstacles
With current political struggles between South Korea and China still rife, the merger follows a particularly damaging drop in both operating profits and stock prices last year.
On February 2nd 2017, It’s Skin stated that its operating profit fell 34.4% year-on-year (YoY) last year to 73.3 bn won (€60.7 mn).
As Chinese consumers continue to demand colour cosmetics products that encapsulate Korea’s leading trends, It’s Skin will focus on marketing its range of products in China, while it prepares strategies and develops items in Korea.