Waldencast Enters $1.2B Three-Way Business Combination with Obagi and Milk Makeup

Waldencast Acquisition today said it plans to merge with skin care brand Obagi and makeup and skin care brand Milk Makeup. The approximately $1.2 billion transaction is a first step in Waldencast’s strategy to create a global multi-brand beauty and wellness platform.

Obagi is a physician-dispensed brand in the dermo-cosmetic space.

Milk Makeup is a cult-favorite beauty brand among Gen-Z consumers.

The transaction will be funded by $345 million in the SPAC’s trust (subject to any redemptions); a fully committed $333 million forward purchase agreement of which $160 million is provided by sponsors Waldencast Long-Term Capital and Dynamo Master Fund; a fully committed $105 million PIPE and $475 million of seller rollover equity. Obagi’s and Milk Makeup’s existing shareholders are expected to hold equity of 20.5% and 14.9% respectively (without giving effect to any redemptions), in the combined company.

The transaction includes significant sponsor alignment with other shareholders in the form of the $160m FPA committed capital. The Waldencast leadership team will directly operate the combined business with a focus on driving growth and shareholder value. Read more.

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