Hangzhou Huanxi Group has acquired a 36% stake in DYD Co., the parent company of South Korean color cosmetics brand Lilybyred, for 120 million RMB ($17.4 million), becoming its largest shareholder. The deal, expected to close by the end of May, will retain the original team and brand identity.
Founded in 2017, Lilybyred is known for its heart-shaped blushers and juicy lip tints, with a strong presence at Olive Young and in markets such as North America and Japan. It entered China in 2025 through Huanxi and is now available on Tmall, Douyin, Watsons, and Sanfu.
However, risks remain. DYD Co. has posted net losses for three consecutive years, with cumulative deficits exceeding 400 million RMB ($58.1 million). Its capital erosion rate reached 60% in the third quarter of 2025, above KOSDAQ’s 50% delisting warning threshold. Previous turnaround attempts in construction and biotech have failed.
Huanxi Group, founded in 2018, is a full-channel brand manager for overseas labels. The acquisition reflects a broader trend of Chinese firms acquiring global beauty brands. Whether Huanxi can revive Lilybyred while preserving its appeal remains the key challenge.
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