UK's Hut Group to buy online retailer Dermstore from Target for $350 million

(Reuters) -E-commerce company Hut Group said on Tuesday it would buy Dermstore, an online retailer owned by Target Corp, for $350 million in cash as it looks to bolster the presence of its beauty brands in the U.S. market.

The British company, which owns retail brands such as Lookfantastic and skin care group ESPA, also bought UK-based Claremont Ingredients and David Berryman for 59.5 million pounds ($80.29 million), looking to scale up its drinks business with the aim of developing flavours tailored to local tastes across the globe.

The Hut Group said the Dermstore deal would help scale up its beauty box business, while speeding up growth of its own brands through a large U.S. customer base.

The company said it was expecting Dermstore to add sales of around $180 million and adjusted core earnings of around $4 million for 11 months of Hut Group’s 2021 financial year.

Hut Group, which went public in September, said it was expecting an antitrust clearance for the Dermstore deal in late Jan. 2021.

Claremont and Berryman’s are expected to add sales of around 15 million pounds and adjusted core earnings of around 4 million pounds in fiscal 2021, the company said.

($1 = 0.7411 pounds)

Reporting by Tanishaa Nadkar in Bengaluru;Editing by Anil D’Silva