The UK-based company already has an established presence in the African personal care market and in particular the ethnic hair care sector.
Croda said the move comes as the Nigerian personal care market shows an increasing need for quality ingredients and technologies.
AR-L will help Croda respond to these opportunities in Nigeria by drawing on its specialist knowledge as a consultant to suppliers and manufacturers on the creation of ethnic cosmetics.
Sowing seeds of cosmetic growth As well as pursuing traditional sales avenues such as holding workshops on Croda's products, AR-L will offer services to help foster long term growth.
Training for local cosmetic companies will be made available and the company will work with higher education institutions and the Manufacturing Association of Nigeria to promote cosmetic science in the region.
The founder of AR-L, Patrick Obukowho, said: "AR-L establishes partnerships that will help develop new, high quality products to meet the demands of the ethnic industry.
"This is an area that has not made improvements in many years, but there are new technologies out there, from suppliers like Croda, that will help produce quality products with the functionality that consumers demand."
Nigerian opportunities Croda is not the only personal care company to be investing in Nigeria.
PZ Cussons, which has a long history of trading in Africa, invested £18m (€25m) in September into its manufacturing facilities in Nigeria following a successful year in the country.
The favourable political climate in the country was mentioned as being crucial to the decision and the company suggested that the economic prospects were also sound given the continued high price of oil.