After announcing its plans to sell its professional beauty business last October, Coty Inc. has signed an agreement for the sale of a majority stake to private equity giant, KKR.
The deal, which includes Coty's professional beauty and retail hair brands including Wella, Clairol, OPI and ghd, has an enterprise value of $4.3 billion.
Under the terms of the agreement, Coty will carve out its Professional Beauty Division, making it a standalone company, in which KKR will acquire a 60 per cent stake and Coty will retain the remaining 40 per cent interest.
The beauty firm said KKR will start by buying $750 million in convertible preferred shares of Coty, followed by additional cash proceeds of approximately $3 billion, and then an incremental convertible preferred investment of $250 million.
“Coty is a leader in the attractive global beauty market with iconic brands, global presence and scale, and a strong track record of innovation and growth,” said Johannes Huth, partner and head of KKR EMEA.
“We are excited to form this partnership to invest in Coty to support it through this period of unprecedented global uncertainty and allow it to emerge as a stronger, more agile business and to acquire a majority stake in Wella, a market leader with a strong portfolio of brands in the attractive professional hair market where we see significant opportunities to accelerate growth in partnership with its experienced leadership team."
"We look forward to working toward the establishment of a lasting and value-creating strategic partnership.”