Ulta Beauty Inc (NASDAQ:ULTA) announced that it it is entering the UK beauty retail market through its acquisition of Space NK from the private equity firm Manzanita Capital.
The financial terms of the acquisition were not disclosed, but media reports estimate the purchase price exceeds £300 million (US$408 million).
Ulta funded the deal using cash on hand and capacity under its existing credit facility, and it is not expected to materially impact its fiscal year 2025 financial results.
Space NK, which operates 83 stores in the UK and Ireland, will operate as a standalone subsidiary of Ulta Beauty. It will continue to be led by its current management team, including CEO Andy Lightfoot.
“International expansion is an integral part of our Ulta Beauty Unleashed plan, and the acquisition of Space NK offers a unique and strategically compelling opportunity to enter the growing UK market with a successful and growing brand,” Ulta Beauty CEO Kecia Steelman said.
“Along with our initiatives in Mexico and the Middle East, we are creating a broader platform for Ulta Beauty to unlock long-term, profitable growth.”
Beauty M&A picks up in 2025
Jefferies analysts noted that the acquisition marks Ulta’s first entry into the UK market, aligning with its broader international expansion strategy.
“In parallel, Ulta is preparing to launch in Mexico through a joint venture with Axo and in the Middle East via a licensing agreement with the Alshaya Group. Initial store openings are planned for late 2025, with launches in Dubai and Kuwait City, and a goal of opening 10 stores in Mexico in a short time frame,” they wrote.
“These moves reflect Ulta’s strategy to scale globally by partnering with established regional players, leveraging their local expertise to bring Ulta’s brand and customer experience to new markets.”
Notably, Space NK’s 2024 results signal traction among young shoppers, the analysts wrote.
In 2024, turnover increased 34% to £196.5 million and pre-tax profit climbing from £1.5 million to £7.5 million.
“This growth was largely driven by younger consumers, particularly those under 25, who represented the fastest-growing segment with a 164% increase,” Jefferies wrote.
“Millennials, Gen Z, and Gen Alpha also contributed to the sales boost. The momentum has continued into 2025, with first-half sales up 38% year-over-year.”
The firm also noted that beauty mergers and acquisitions (M&A) has picked up materially in 2025.
“The news follows recent beauty deals including L'Oreal's purchase of Color Wow and Medik8, ELF's acquisition of Rhode, and Unilever buying Dr. Squatch. Reports have also suggested Coty is looking to sell,” they wrote.
Shares of Ulta Beauty added 1.9% at $485 late morning on Thursday.