L’Occitane Group is struggling to get the sale of Elemis to PAI Partners across the finish line, but the transaction has not fallen through, four sources familiar with the matter said.

The sale is facing two main hurdles: disagreement between the vendor and the bidder over the British skincare brand’s valuation, three of the sources said, and PAI Partners’ difficulties funding the acquisition, two added.

Despite the complications in closing the transaction, it is expected to complete, three of the sources said, noting that PAI Partners has been in exclusive talks with L’Occitane to acquire Elemis from the beginning of the sale process.

The process, on which Morgan Stanley is the sellside advisor, is complex, one source said. Elemis is likely to fetch a valuation below the USD 900m L’Occitane paid for the brand in 2019, making the terms of a potential sale less attractive to the group, this source added.

A source close to the situation said Elemis will be valued above USD 800m.

However, given the significant amount of debt L’Occitane needs to repay to Blackstone following its 2024 take-private transaction, the company’s “hands are tied”, one source said.

L’Occitane Group was taken private in 2024 in a deal backed by Blackstone, ending its 14-year listing on the Hong Kong Stock Exchange.

The Switzerland-based beauty conglomerate reported EUR 2.8bn in annual sales for the year to 31 March 2025, up roughly 12% from the same period a year earlier. Elemis then represented about 10% of its total annual sales.

In its full-year 2025 financial report, L’Occitane said that it started its fiscal 2026 year with cautious optimism, and that it believed it was well positioned to drive healthy and sustainable growth.

Morgan Stanley declined to comment. L’Occitane Group and PAI Partners didn’t respond to requests for comment.