Alibaba-backed beauty tech firm Perfect Corporation to merge with US blank-cheque company in deal worth US$1 billion
- Perfect is known for ‘YouCam’ app that allows users to try on make-up and hair dye virtually
- As part of the deal, Perfect will receive US$50 million from strategic investors such as Chanel, Shiseido and US camera company Snap, among others
Perfect Corporation, a Taiwanese augmented reality (AR) software services provider focusing on beauty and cosmetic brands, has signed an agreement to merge with Nasdaq-listed blank-cheque company Provident Acquisition Corporation in a deal that values it at US$1.02 billion.
Part of the proceeds that Perfect will receive include US$50 million from several strategic investors such as Chanel, Shiseido and US camera company Snap, among others.
The deal, subject to shareholders’ approval and other regulatory clearances, is expected to close in the third quarter of this year. If successful, it will see Perfect list on Nasdaq under the ticker “PERF”.
Perfect uses AI and AR to help cosmetic brands create more accurate product matching by creating a 3D face for users. It uses machine learning and facial recognition in an emerging sector known as beauty tech. It currently has 44 patents that have either been granted or are pending, and claims that its enterprise solutions are used by more than 400 beauty brands in over 80 countries.
Perfect also has tie-ups with leading e-commerce platforms, such as Alibaba’s Taobao and Snap’s Snapchat, enabling cosmetic and beauty brands to use its AR solutions to expand and engage online shoppers.
Before its merger with Provident Acquisition, Perfect said it had raised a total of US$130 million over four rounds of financing. The last two rounds were led by Goldman Sachs Asset Management in January 2021, and by Alibaba in September 2019, data from Crunchbase shows.
“We’ve come close to breaking even for the past three years,” a spokesperson said, adding that the company saw continued growth and profitability next year.
Provident Acquisition is led by Winato Kartono, the founder of Southeast Asia-focused private-equity firm Provident Growth, which is based in Hong Kong. He was formerly the head of investment banking in Indonesia for Citigroup.
Goldman Sachs is the financial adviser to Perfect. Citi and Barclays Capital are co-placement agents of the deal, with the latter also serving as the merger and acquisitions adviser to Provident Acquisition. The companies will discuss the deal with the SPAC’s investors later on Thursday.
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