Shares of L’Oréal’s small-cap partner have surged. It will go private

Shares of Perfect Corp., a small-cap developer of AI solutions for the beauty industry and a partner to global brands including L'Oréal, soared by more than 10% on July 10. The company has entered into a definitive agreement to sell its business to an entity controlled by its founder, Alice Chang, and to subsequently delist.

Perfect Corp. shares rose more than 10% on July 10 on the New York Stock Exchange, reaching $1.92. This is the highest level since mid-December 2025.

The AI solutions developer announced a merger with ProjectNY, a company controlled by its founder, Alice Chang. The deal is valued at $2 per share, which is approximately 48% higher than the closing price on March 17—the day before the company received a preliminary offer from a consortium of investors led by Chang, according to a press release. This also represents a premium of about 39.6% over the stock’s 30-day volume-weighted average price, the press release noted.

Perfect Corp.'s board of directors has already approved the merger; now it must be supported by at least two-thirds of the shareholders, the company said. Holders of 53.4% of outstanding shares and 81.2% of voting shares are in favor of the merger, according to a press release.

The parties plan to complete the transaction in the fourth quarter of 2026, after which Perfect Corp. will become a private company and its shares will no longer be traded on the stock exchange.

Perfect Corp. was founded in 2014 as a division of the Taiwanese IT developer CyberLink—a company that Chang founded with her husband in 1996 and led for 18 years.

When personal computer sales slowed down, Chang began thinking about how to expand her business and start developing apps for the growing smartphone market. The first such apps were YouCam Perfect, which allows users to “remove” pimples or dark circles under the eyes from photos, and YouCam Makeup, for applying virtual makeup. For this, Forbes named Chang the “godmother” of virtual makeup.

At first, the entrepreneur did not commercialize her innovations, but a little later she began offering the technology to major cosmetics brands. Her proposal was based on a simple idea: the more people “try” a product for themselves, the more they buy.

Perfect Corp.'s business currently consists of two parts: apps for consumers and apps for brands. Its partners include L’Oréal, Estée Lauder, Sephora, Shiseido, and Avon.

In the first quarter of 2026, the company's revenue rose 12% year-over-year to $17.9 million, and net income rose 2.6% to $2.4 million.

Since the beginning of the year, Perfect Corp.’s stock price has risen by nearly 6%. All three Wall Street analysts who cover the company recommend holding its stock. The average price target is nearly $2, which corresponds to their valuation for the deal with ProjectNY.