Blackstone has opened a potential divestment of ZO Skin Health, the medical-grade skincare business founded by dermatologist Dr. Zein Obagi in 2007, people familiar with the situation said. Those sources, who asked not to be identified because the discussions are private, indicated a deal could put ZO at roughly $2 billion in value.
The investment firm has enlisted Citigroup and Raymond James to support the sale process, the sources added. According to the same people, the efforts are still in an early stage. Blackstone and Citigroup declined to comment on the matter, and neither ZO nor Raymond James provided immediate responses to requests for comment.
ZO Skin Health’s product set includes physician-distributed cleansers, serums, exfoliators and toners that are sold through dermatologists and other skincare professionals. The company was launched by Dr. Obagi in 2007 and has positioned itself in the medical-grade segment of the skincare market.
Industry interest in assets like ZO is reflected in a broader preference among strategic buyers for clinically backed, physician-distributed skincare brands. Those buyers often cite efficacy and comparatively steadier demand versus over-the-counter products as reasons for focusing on this category - trends that frame the context for any potential transaction involving ZO.
Context and implications
While the process is described as early and details remain limited, the engagement of major advisers such as Citigroup and Raymond James suggests a structured sale process is being put in place. For prospective acquirers, ZO’s physician-distributed model and clinical positioning are central to the brand’s value proposition, according to the description of the company’s product distribution and market appeal.
Because parties directly involved have not publicly commented, the timetable, potential bidders, and final pricing are not available at this time. Observers will likely watch for further announcements should the process advance beyond preliminary outreach and valuation work.
What remains unclear
- Whether the sale process will progress to a launched formal auction or result in a completed transaction.
- How the approximate $2 billion valuation estimate will hold up as the process moves forward and more information is disclosed.
- Which strategic or financial buyers, if any, will signal firm interest once the process advances.