South Korea’s leading cosmetics original design manufacturing (ODM) company Kolmar Korea Co. acquired a U.S.-based cosmetics maker in an attempt to raise its competitiveness in the North American market.

Kolmar announced on Monday in a regulatory filing that it signed a deal to buy American cosmetics ODM maker Process Technologies & Packaging (PTP). It has established a special purpose company named Seokoh to acquire a 51 percent stake in PTP for about 17 billion won ($15.2 million).

The Pennsylvania-based PTP has offered its products to global cosmetics giants such as L’Oreal, Coty and Shiseido. “PTP, whose annual sales amount to 50 billion won, is still lagging behind some major cosmetics ODM suppliers such as Intercos and Kolmar, but it has an unrivaled strength in decorative cosmetics,” said an official from Kolmar Korea. “The acquisition is expected to create a huge synergy from the combination of Kolmar Korea’s prowess in basic skincare products and PTP’s strength in decorative make-up products,” he added.

The takeover deal is part of a joint partnership with Wormser Corp, a U.S.-based contract manufacturer of cosmetics, who will acquire the remaining 49 percent stake in PTP. The New Jersey-based Wormser, founded in 1950, engages in a wide ranging business including designing, packaging and delivering cosmetics products. The company also supplies its products to global cosmetics companies like L’Oreal and has operations in Shanghai and London.

It is reported that Yoon Sang-hyun, Kolmar Korea’s new CEO and the eldest son of the company’s founder Yoon Dong-han, has led the whole process of the acquisition. “When Kolmar Korea’s competitiveness in basic skincare is combined with PTP’s strength in decorative products and Wormser’s broad network, a significant synergy would be generated,” said Yoon. “The deal will help us bolster our number one position in the global cosmetics ODM market and expand our footprint further into the American market,” he added.

By Chung Soon-woo

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