Payot sale interrupted as Weinberg drops out

The major issue was French skincare company's exposure to the Russian market, where it generates between 20% to 30% of turnover, one of these and a fourth source familiar said. Payot has several stores in Russia, according to the company's website.

Weinberg pulled out of the deal in March, after the war in Ukraine began, two of the sources said. However, the vendor is in discussions with other parties, a fifth source familiar added.

To terminate the acquisition contract already agreed, Weinberg used Material Adverse Change (MAC) clauses stipulated in it, two of the sources said. Another option could have been for Weinberg to ask lenders to decline financing, another source said. The latter strategy proved popular during the first lockdown in 2020, due to the scarcity of MAC clauses in documentations and the difficulty of enforcing them in France, as reported by Unquote's sister publication Debtwire.

Payot generates around EUR 5m in EBITDA and could be valued at 10-15x EBITDA, as reported. Vulcain is advising LBO France on the sale, which kicked off in 4Q last year.

The business has an international presence, with France accounting for around one third of sales, as reported. It operates an omnichannel sales strategy and is present across marketing channels including spas, speciality retailers, pharmacies and e-commerce.

LBO France acquired an 80% stake in the business from Spanish perfume group Puig in 2014, one of the sources said. Payot was founded in 1920, as per the sponsor's website.

Weinberg and Vuclain declined to comment, while LBO France and Payot and did not respond to requests for comment.

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• Topics
• Exits
• France
• Consumer
• Mergermarket
• LBO France
• Weinberg Capital Partners