Japanese online cosmetics seller @cosme mulls selling off Malaysian unit after blow from pandemic
KUALA LUMPUR, NNA – The operator of beauty product e-commerce website @cosme is considering whether to sell its entire stake in Hermo Creative (M) Sdn. Bhd., a deficit-ridden subsidiary in Malaysia that has been hit by economic fallout from the world COVID-19 outbreak.
Tokyo-based istyle Inc. said in a statement last Friday that it had decided at a board meeting to explore the idea of selling shares in the Malaysian firm so istyle can focus staff and money on higher priorities -- including at home.
“We’ll focus more on our business in Japan,” Taketo Ogaki, an istyle spokesman in Tokyo, told NNA on Monday. ”We’re not considering launching new overseas business projects from a short-term perspective.”
The company has not decided on a price for its shares or named a potential buyer, its statement said.
The company will continue providing smartphone apps for @cosme in Malaysia.
Istyle has a 30 percent stake in Hermo and its wholly owned subsidiary istyle Global (Singapore) Pte. Ltd. has 53.1 percent. Hermo runs an e-commerce website that sells beauty products in Malaysia.
Hermo has posted a net loss for five consecutive business years, and spread of the novel coronavirus has made business harder this year to date.
In the year ending in December 2019, Hermo logged 34.12 million ringgit ($8 million) in sales and 3 million ringgit net loss. The Malaysian firm faces intensifying competition from Chinese e-commerce websites, the istyle spokesman said.
The Malaysian firm is headquartered in Johor Bahru, Malaysia, and became an istyle subsidiary in 2017.
Istyle runs brick-and-mortar stores in Japan, Hong Kong and Thailand as well as Japanese and cross-border e-commerce sites. Its online portal gets 11.5 million users monthly, according to its financial statement released on May 8.