Private equity giant Kohlberg Kravis Roberts is understood to have entered talks with possible suitors for Laser Clinics Australia, with sources suggesting it could be targeting private equity firms out of Europe and a deal worth more than $1bn.
KKR bought the hair removal and injectables clinic business in 2017 for $650m and previously worked with investment bank Citi on the business.
DataRoom reported earlier this month that the New York-based buyout fund was once again weighing its options for Laser Clinics Australia.
It is understood that KKR or its advisers have been reaching out to buyers in recent days to test interest, although there is no official sale process.
Since the purchase, KKR has doubled the size of the beauty services provider, which has been expanding in Europe and Britain.
Another private equity firm with investment already in the sector and region could see the business as an attractive opportunity.
Following a falling out with franchisees who wanted to terminate their agreements, KKR has moved to buy the clinics back within the network.
The business sits in one of KKR’s older investment funds.
The Laser Clinics investment was appealing to KKR as beauty treatments are growing and appealing to a wider section of the population due to product innovation and declining service costs.
Smaller rival Silk listed in 2020 and was privatised by Wesfarmers after it failed to trade above its float price.
At the time Silk listed, the Australian market generated annual revenue of $5.4bn a year and was expected to grow at an average annual rate of 10 per cent to $7.8bn by 2024.
KKR is a big investor in the Australian market. It owns businesses in snacks company The Arnott’s Group and is a major shareholder in non-bank lenders Latitude Financial and Pepper Money.
KKR recently weighed a purchase of logistics chain Loscam that had been up for sale through UBS for about $3bn, and its infrastructure fund bought a major stake in Gold Coast airport owner Queensland Airports with Skip Capital. It is also a shareholder in Spark Infrastructure. It also owns half of wealth manager Colonial First State and accounting software company MYOB, and New Zealand pet food company Natural Pet Food Group.
KKR sold pubs company Australian Venue Co last year to Asian fund PAG for about $1.4bn.
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