This Oakland company just announced a $1 billion deal with Hailey Bieber

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Elf liquid eyeliner arranged in Germantown, New York, US, on Monday, July 17, 2023. (Photographer: Gabby Jones/Bloomberg via Getty Images)

OAKLAND, Calif. - Oakland-based cosmetics giant e.l.f. Beauty has announced a $1 billion deal with celebrity influencer Hailey Bieber in what’s being called a "powerhouse alliance."

E.l.f. is acquiring Bieber’s Rhode skincare brand, which the 28-year-old model and wife of Grammy-winning singer Justin Bieber launched in 2022.

‘Like-minded’ entities

E.l.f. officials said it has found a "like-minded" business partner in the Los Angeles-based company, as Bieber’s brand further amplifies its vision to "disrupt norms, shape culture and connect communities."

In an investors' press release issued by e.l.f. on Wednesday, company Chairman and CEO Tarang Amin said, "rhode further diversifies our portfolio with a fast-growing brand that makes the best of prestige accessible. We are excited by rhode’s ability to break beauty barriers, fully aligning with e.l.f. Beauty’s vision to create a different kind of company."

By the numbers:

The $1 billion deal includes $800 million in cash and new shares of e.l.f. stock and an additional potential $200 million payment based on the future growth of the Rhode brand over three years, according to e.l.f.

The Bay Area-based cosmetic company said Rhode has built a reputation on its collection of multitasking, high-performance, skin-focused products that have demonstrated exceptional growth with a strong direct-to-consumer model.

Rhode earned $212 million in net sales in the 12 months that ended March 31.

What's next:

Its products are currently available online only, but Rhode plans to launch its first in-store partnership with Sephora retailers throughout North America and the U.K. by the end of the year.

LONDON, ENGLAND - MAY 17: Hailey Bieber attends the Rhode UK launch party with Hailey Bieber at Chiltern Firehouse on May 17, 2023 in London, England. (Photo by Dave Benett/Getty Images for Rhode)

Bieber's role

Bieber will continue her role as founder, while also serving as Rhode’s chief creative officer and head of innovation. E.l.f. said she will also take on the title of strategic advisor to the combined companies.

"A defining voice in beauty, Bieber stands out as a cultural tastemaker and top beauty influencer," e.l.f said.

Dig deeper:

The Oakland cosmetics giant has its headquarters in the historic Old Oakland downtown neighborhood of the city.

E.l.f., which stands for "eyes, lips and face," launched in 2004 and promotes itself as a clean, quality, and affordable makeup and skincare line.

The company has also been known for its bold stance on diversity, equity, and inclusion initiatives with a vision that promotes inclusivity.

E.l.f. promises its products are made in fair-trade certified facilities, are responsibly sourced and free from any animal testing.

"This powerhouse alliance between e.l.f. Beauty and rhode is built on both brands' shared focus on disruption and product innovation," the Bay Area company said, "setting the stage for transformative global expansion."