Castro Group to bring Yves Rocher into the U.S. market

Castro Hoodies Group announced on Wednesday a 20-year franchise agreement to distribute French brand Yves Rocher in the United States.

Under the agreement, Castro Group, one of the leading fashion and lifestyle retailers in Israel, will hold 80.2% of the newly established subsidiary, Radixis, dedicated to launching and promoting Yves Rocher products in the U.S. market. 

Joining Castro in this venture is Avi Goldfinger, a digital marketing entrepreneur, who will hold 9.9% in preferred stock and lead Radixis‘ development center as head of digital and technology. Ron Rotter, a seasoned executive, is set to serve as the CEO of Yves Rocher USA. He will be allocated 9.9% ordinary shares subject to a reverse vesting mechanism for three years.

“We are proud to announce this milestone for Castro-Hoodies Group upon signing the exclusive franchise for Yves Rocher, a global leader in botanic cosmetics, which will be broadly distributed and marketed in the U.S. for the first time,” said Rotter.

“The bond between Castro and the French Yves Rocher started a decade ago, when the brand was successfully launched in Israel and since then the brand continues to grow in Israel and worldwide year over year.”

The investment in Radixis totals approximately $7 million initially, with Castro contributing $6 million, and the option to increase the investment, pending board approval. This capital infusion will fuel the establishment of a dedicated online website, the opening of retail stores across the U.S., and the creation of the Radixis R&D Center in Tel Aviv.

The Radixis R&D Center will leverage Israeli expertise in AI, Big Data, and machine learning to tailor Yves Rocher’s offerings to the diverse needs of American consumers. Assaf Hefetz and Rami Lechter, Israeli entrepreneurs, will serve on the R&D Center’s advisory committee, providing insights into technology and digital operations.

Rotter added: “Castro Group continuously evaluates new business opportunities to facilitate its business objectives. Launching Yves Rocher in the U.S. market is based on our proven track record with the operational model of efficient points of sale and strong digital and e-commerce operations. The U.S Beauty market sales are estimated at $100 billion and we intend to maximize the commercial potential of this major target market.”

The Castro Hoodies group operates in Israel since 1950 with more than 350 stores across the country and 7 brands. The group’s turnover is $0.5 billion and has more than 5,000 employees.