Good morning. I'm Michel Brousset, Founder and CEO of Waldencast. I am very excited to announce this transaction alongside with our Waldencast executive team, Felipe Dutra, Chairman of our Board, Hind Sebti, my Co-Founder and Chief Operating Officer, as well as Tassilo Festetics, our Chief Financial Officer and Chief Technology Officer. We're a team that is a bit different from the traditional financial SPAC sponsors. We are first and foremost operators. With deep experience in beauty, wellness, and consumer goods, we have built and scaled global brands and businesses and have deep expertise also in M&A, which will be a cornerstone of our future growth. Our journey began with one clear ambition to build a global best-in-class beauty and wellness multi-brand platform by creating, acquiring, accelerating, and scaling the next generation of high-growth, purpose-driven brands.
Brands that can scale through this platform, benefiting from the company's strong product and brand development capabilities, as well as our industry-specific expertise. Our starting point in this journey is beauty, an industry we know extremely well and a beautiful category. The beauty business is, in fact, beautiful. It is big, offering a massive addressable market made of five core categories, the biggest ones being skincare and color cosmetics. Its high growth is driven by its unique and highly attractive consumer dynamics, where desire for quality outweighs price, and the appetite for clean, natural, and high-performance innovative products and brands fuels a constant usage expansion and regimen extension. On top, it also benefits from microdynamics in the form of huge opportunities in new emerging markets like China, Brazil, India, Indonesia, et cetera, as well as the growing e-commerce channel that allows brands to effectively reach consumers around the world.
These drivers have ensured that beauty was resilient through many economic cycle and to recover very fast from downturns. As we have seen in the bounce back from the 2008 recession and more recently, post-COVID lockdowns, growth that is projected to carry on over the next years. Lastly, not only is beauty big and fast-growing, it is also highly profitable, thanks to its superior structural economics and capital efficiency. The global beauty market is still fragmented. In fact, the top five players represent only 32% of the market. This is explained by beauty's unique consumer dynamics. It is an expandable market, a market of want, where there's not a winner takes all. Within this big, resilient, and profitable market, independent brands are leading the growth and gaining market share.
Often they do fail to scale, mostly due to a lack of operational expertise and resources needed to scale a beauty brand globally. This is where we see a clear opportunity to aggregate high-growth emerging brands under a new platform to further accelerate and scale their growth. Until now, the industry has been an incumbent versus indie play. Over time, however, we have seen an erosion of traditional sources of competitive advantage for incumbents, while at the same time creating further opportunities for indie brands. First and most importantly of success in beauty is a brand DNA. The incumbent portfolio of brands, in many cases, is not necessarily reflective of the evolving values important to consumers today, values such as inclusiveness, social responsibility, and sustainability.
While on the other hand, most indie brands tend to be born and built around a consumer truth and values that resonate with consumers today. Second, how brands reach consumers has also changed. While historically, large advertising budgets heavily weighted towards traditional media were needed, digital marketing, social media, precision targeting, has fundamentally reshaped how indie brands and brands in general reach their consumers and reimagined traditional marketing and product discovery. Third, there's also been an obvious shift in distribution channels. While the incumbents used to have a lock on physical shelf space in department stores, especially retail and food, drug, and mass channels, and a significant cost to play, e.g., the inventory you have to carry to participate, e-commerce provides direct access to consumers and enables brands to launch outside of traditional distribution channel, previously a source of strength for incumbents.
Fourth, infrastructure used to be a source of advantage for incumbents with open innovation, outsourced quality manufacturer, and 3PL logistics and cloud-based systems. Today, these asset-heavy structures are not only not necessary, but we would argue a source of disadvantage that results in heavy, inflexible organizations, resulting in longer lead times and a slower reaction time to fast-moving trends. Lastly, there has also been a transformation in regards to talent. Today's young talent is interested in other attractive opportunities versus a traditional corporate job. They want autonomy, they want flexibility, entrepreneurship, and hence, incumbents suffer from attrition to other attractive opportunities that are more in tune with the needs and desires of this new generation of talents. On the other hand, although many independent brands have achieved strong growth initially, the ability to drive sustained growth and really scale globally is far more challenging.
Category complexity requires operational and industry expertise and resources to drive enduring success for a beauty brand. That is exactly what we set out to do at Waldencast, merge the best of both worlds. Leaving the bad of both worlds behind by bringing the high growth and consumer relevance of purpose-driven beauty brands with an operational model that enables them to scale to the expertise and resources of a best-in-class operating multi-brand platform. All of this while maintaining the entrepreneurial spirit and agile and responsive asset-light efficiency so critical to the success of indie brands. How we will do this, it is by our operating model built around eight pillars. First, a growth-oriented business model that identifies and creates high-potential brands and scale through brand-led independence, asset-light modularity, intelligent synergies by aggregating functions where there's no advantage to have them on a single brand.
Our own Waldencast culture, our Waldencast of performance and ownership. The fact that we're dedicated only a beauty and wellness pure player where expertise matter, where having deep, broad experts makes a difference. Through our conscious entrepreneurship, we founded Waldencast first and foremost to make a small positive difference in the industry through our values of responsibility, inclusivity, and sustainability. Over time, what we want to do after we go through this first step of acquisitions is build a balanced business portfolio across channels, geographies, price points, et cetera. Now, we share what the beauty opportunity is and how we intend to answer it. Now I am very pleased to announce a Business Combination with two very exciting brands, both anchored in big, high-growth categories we discussed before and leaders in their respective fields.
Obagi is an industry-leading advanced skincare line recognized for its clinical excellence, industry-leading innovation, and science-backed approach, positioned in the high-growth dermocosmetic category. Milk Makeup is a high-growth, cult favorite beauty brand among Gen Z consumers and a leader in clean beauty, known for its strong community, cultural relevance, and iconic products. These brands represent the first acquisitions in our multi-year journey to build our multi-branded platform focused on the next generation of high-growth, purpose-driven brands. When we raised this vehicle earlier this year, we defined very specific investment criteria for the brands that we would ultimately partner with. Both Obagi and Milk Makeup tick each one of these criteria.
They have strong brand identities with enduring brand equity, a high level of consumer affinity with differentiated offerings and market positioning, a strong online community, and omni-channel growth opportunities, a long-term sustainable business model with several exciting levers to drive growth. We're excited by the opportunity to partner together and accelerate the growth of both brands while preserving each brand's unique business model and entrepreneurial spirit. We believe the brands will benefit strongly from the Waldencast ecosystem, bringing operational scale and attracting best-in-class talent and capabilities. Now, let me tell you more about each brand, who they are, their strengths, and their growth opportunities. Let us start with Obagi. Obagi is a leading physician dispensing brand in the high-growth dermocosmetic category with strong anchor capabilities and attractive growth opportunities. Obagi created a professional skincare category in 1988 and has continued to pioneer its space ever since.
With a 33-year legacy of science and innovation, Obagi designs transformational prescription and over-the-counter products that promote skin health. Obagi's formulations are scientifically backed, clinically tested, and recommended by physicians worldwide. Now, let me share a few key facts about Obagi. First, we forecast it will achieve $168 million of net revenue in 2021, with 25% adjusted EBITDA. This is a leading and growing brand with 14% net revenue CAGR from 2019 to 2021, despite the COVID pandemic in the middle. Most importantly, we believe it is the crown jewel of the physician dispensing dermocosmetic channel, as it is rated as the number one perceived best-performing brand among U.S. providers. It is renowned for its proprietary technology and protected by 80+ patents worldwide.
We're extremely excited to partner with the Obagi team and believe there's significant opportunity to drive further growth and profitability. This amazing brand is led by outstanding team who are experts in the field. The team is led by President and CEO Jaime Castle, who brings over 20 years of experience in the industry, and I look very much forward to working with the entire Obagi team. We mentioned earlier that skincare is the biggest beauty market and one of the fastest-growing ones. It is projected to reach $209 billion in retail sales in 2025. It is a high-growth segment with a strong momentum in the post-lockdown era, driven by increasing demand for science-based skincare and bolstered by what we call skintellectual consumers, focused on increasing levels of product potency and efficacy.
Dermocosmetics is among the fastest-growing subcategories in a rapidly expanding market that continues to be driven by premiumization. Within that high-growth dermal professional market, Obagi is a pioneer and a leader, ranking number one across multiple dimensions. It is perceived as best performing brand among U.S. providers based on their perception and satisfaction, defined by the quality of its product portfolio and innovation, and is strongly regarded for its marketing. We believe that the combination of having a brand leader in our portfolio within a fast-growing market is very, very powerful. The basis of Obagi's strength is the leadership on product and innovation was driven by science-backed formulations trusted by physicians in the U.S. and worldwide. These are high-performance products developed single-minded with fact-based medical efficacy in mind and supported by patents and extensive expert R&D team.
This results in high recognition from practitioners, visible in the long-term relationship they have successfully built. The brand's portfolio of highly effective products is anchored by medical products. The medical products within the Obagi portfolio drive 90%+ of the sales, of which 25% are prescription products, and thus set the foundation of the growth levers. First, a continued increasing penetration within the medical channel through practitioners, increasing the number of practitioners and the share of wallet within practitioners. Second, and to extend the brand reach in more consumer channels where the appetite for trusted science and ultra-high performance skincare is huge. Third, deepen the physician partnership and retention through entry into in-clinic devices. And then lastly, build a spa channel following the same best-in-class approach that made the brand a physician's favorite.
Obagi is a gem and a leader in the U.S. dermocosmetic market, and our ambition is to make it the top dermo-credentialed brand in the world. We intend to do this by building on its unique strength and anchoring its medical credentials to expand into a consumer space, deepen the penetration in professionals through existing medical portfolio and services and also in the clinical spa channel. We intend to drive international growth by extending and executing a global e-commerce platform, as well as expand into key global markets where there is already latent awareness of Obagi. Of course, partner with Waldencast, leveraging our consumer and brand-building expertise, as well as our data-driven asset-light platform to enable the above acceleration. Now, from the world of skincare, let's go into the world of makeup. Milk Makeup is a super exciting high-growth opportunity.
It is a cult favorite beauty brand among Gen Z consumers and a leader in clean beauty that has grown organically to a diverse and inclusive community and is known for its cultural relevance and iconic products. Milk Makeup is built on the promise of clean, cool beauty that works with best-selling hero products at key retailers. Now let's look at some top-line numbers for Milk Makeup. We expect it to generate $47 million of net revenue in 2021, and it's growing fast at 24% CAGR growth between 2018 and 2021 despite the COVID lockdown. It is the number two clean brand at Sephora with multiple best-selling products, including the cult favorite face primers and mascara. It is a brand uniquely built on a community of 1.9 million Instagram followers. Milk Makeup is led by a talented leadership team with deep experience in beauty.
Tim Coolican, CEO of Milk Makeup, has over 20 years of experience solely in beauty, and we had the pleasure of working together while we were at L'Oréal. As mentioned before, makeup is one of the top beauty categories with very dynamic growth, is strongly rebounding post-pandemic as lockdown restrictions ease and consumers experience the infamous lipstick effect. Its growth is driven by a never-ending innovation in looks inspired by culture, fashion, and design, as well as increasing demand for clean, meaning good for you, beauty offerings. Within this high-growth clean makeup market, Milk is a leader and a brand built by connecting strongly with the untapped and coveted Gen Z market.
Milk Makeup is a brand built on the promise of clean, cool beauty that works and has become known quickly for its innovative, iconic products with global resonance, as well as strong values that connect with consumers, committed to developing vegan, clean, and cruelty-free products. Anchored in culture, it is a brand built on community that champions inclusivity and values perfectly aligned with the next generation. Good for you, good for the planet, and good for the community, leading to impressive following and support across key social media channels. This cult buzzing brand with a unique DNA has still two major opportunities to drive growth. First is brand awareness. The opportunity here is to build on the strengths of their existing Gen Z community and raise awareness of the brand to other groups by investing and marketing the brand in a major way. Second, to drive thoughtful innovation.
The brand currently only has 330 SKUs relative to other successful brands in the space with over 1,000 SKUs. Milk is a category leader in primer, mascara, blusher, but has tremendous opportunities to grow in all other existing makeup categories and expand into new areas of white space. The brand was also built on a strong and successful partnership with Sephora, where the brand was allowed to express itself, its range and unique point of view, and gather the consumer following it has today. There is even more to come from that partnership as we deepen the consumer penetration and awareness within Sephora in North America and globally. We look at the brand distribution global footprint. We can see the huge opportunity of growth within existing markets as well as the new untapped geographic expansion opportunities, both within brick-and-mortar and e-commerce.
Our ambition is clear and simple. We want to build Milk Makeup into the world's top makeup brand of the new generation. We're very excited to partner together and drive growth by expanding its community, portfolio, and geographic reach. To recap our plan, first, we expect to grow the consumer base by thoughtfully increasing marketing spend in a deliberate way to drive awareness and trial, and also broadening the brand footprint. Second, we expect to accelerate innovation and expand product assortment and strategically enter new categories. Third, we want to build the global brand availability by maximizing the Sephora ecosystem, expanding into key remaining markets, and developing a highly efficient international direct-to-consumer model. Lastly, the brand will partner with Waldencast to improve gross margins through operational efficiency and also leverage Waldencast intelligence synergies to manage complexity across the supply chain.
Now I will spend time walking through the financials of both brands on the transaction. Obagi is a growing brand with a strong financial profile. The company expects to generate $168 million in net sales in 2021, which represents an 87% growth rate year-over-year. In addition, I would like to highlight Obagi's attractive growth margin profile. Our growth margin in 2021 of 76% are comparable to best-in-class across the beauty category. The combination of Obagi's growth profile and a strong profitability results in an attractive adjusted EBITDA profile. We expect to generate $42 million of EBITDA in 2021 and an implied adjusted EBITDA margin of 25%. Milk Makeup is an exciting younger brand with a great growth engine.
The company expects to generate $47 million in net sales in 2021, which represents a 24% CAGR over the last four years, again despite the impact of COVID in store closures and changing consumer behaviors. The company is perfectly positioned for strong rebound with exciting growth categories ahead. We believe also there is opportunity to drive gross margin improvement and build further value from 49% in 2021 to 60%+ in 2023. Our operating platform at Waldencast is designed to identify, implement, and execute on opportunities to drive operational enhancements for our brand partners. Now let's look at the company on a combined basis. A combination of Obagi and Milk Makeup results in a multi-brand platform that is differentiated in its high growth profile, strong growth margins, and an attractive profitability profile that aligns with best-in-class peers.
We have outlined the transaction overview on slide 38. The pro forma enterprise value of the company will be approximately $1.2 billion at an attractive valuation of 16.5x 2023 adjusted EBITDA, which compares favorably to comps outlined on the next slides. Existing shareholders of both Obagi and Milk are rolling about half of their equity into a new company, confirming their belief and excitement of the possibilities ahead together. Concurrent with this transaction, we have raised $105 million of PIPE, and we expect the deal to deliver up to $202 million of cash to the combined company's balance sheet. Turning to slide 39, Waldencast, as you can see, compares favorably across its peer group in terms of growth and margin profile. Lastly, on slide 40, you can see the multiple comparables to our peers.
We believe this is an attractive entry point for investors based on where the public comps trade and that this deal has potential upside as both brands execute on the many growth opportunities ahead. Just to close, this transaction represents the first step in the creation of a global best-in-class multi-brand beauty and wellness platform. We're incredibly excited for what the future holds, and with that, I will conclude my remarks. Thank you for taking the time to be with us today.