Historic perfume house Caron is up for sale

By

Astrid Wendlandt

Published
Jul 4, 2018

Caron, the oldest perfume house in France after Guerlain, is up for sale as part of a financial restructuring at parent company Alès Groupe, a Paris-listed company that owns skincare brand Liérac and hair products Phyto, sources with first-hand knowledge of the matter told FashionNetwork.com.

The 114-year old French perfume brand, best known for its men’s fragrance “Pour un Homme” created in 1934; its high-quality face powders and its stores' perfume fountains, had been ideally positioned to benefit from the market’s solid appetite for authentic niche perfumes. Instead, Caron saw revenues decline from 10 million euros in 2013 to around 8 million euros in 2018, sources said on condition of anonymity. Alès Groupe has retained investment bank Lazard to help it find a buyer. Alès Groupe did not reply to requests for comment while Lazard declined to comment.

When it published full-year results in April, Alès Groupe said that it was about to break its banking covenants in terms of debt ratio and banks had given it until July 15 to renegotiate terms with creditors. It also announced plans to cut jobs in France and restructure some of its operations.

Founded in 1904, Caron is regarded as one of France’s most prestigious perfume houses with sophisticated and powdery scents such as “Narcisse Noir,” which dates back to 1911, and “Fleur de Rocaille.” Back in 2013, Romain Alès, president of Alès Groupe, said in an interview with Reuters that he aimed to boost the brand’s sales by pushing exports to Russia and the Middle East.

Caron is tiny for Alès Groupe as it makes up only around 3-4 percent of its parent’s turnover. Sources said the brand was near financial break-even but its poor performance in recent years combined with major investments in new boutiques in Paris weighed on the group’s overall finances. In 2015, Caron caved in to LVMH’s persistent demands to acquire its corner shop opposite Dior on luxury strip Avenue Montaigne, a space in which LVMH eventually put in a Dior jewellery boutique. Caron reopened another store nearby on rue François 1er.

According to brand’s website, Caron still has four stores in Paris and makes the bulk of its revenues in France.

The niche perfume space has seen a flurry of deals in the past four years with LVMH in 2017 buying Maison Francis Kurkdjian – which made at least twice the revenues of Caron or around 15-20 million euros. Before that, L’Oréal snapped up Atelier Cologne, Spain’s Puig bought Penhaligon’s and L’Artisan Parfumeur and Estée Lauder bought Editions de Parfums Frédéric Malle, Le Labo and By Kilian. Valuations have ranged from two to ten times annual sales, depending on the brand’s profitability and growth perspectives.

For many years, Alès Groupe, which has owned Caron since 1998, said the perfume brand was not for sale even though it had been approached regularly by suitors.