Oct 1 (Businesshala) – Coty Inc said on Friday it will swap its nearly 9% stake in professional beauty business Wella with KKR & Co Inc, for shares of some of the cosmetic maker that owns the US buyout firm , the deal is valued at $426.5 million.
The deal reduces Coty’s stake in Vela to approximately 30.6%, which is valued at approximately $1.38 billion. The CoverGirl cosmetics maker sold a 60% stake to KKR in December last year for about $2.5 billion, while the remaining 40% stake was valued at $1.3 billion.
Coty said the value of Wella has risen since the close of the majority stake sale, as business has improved from the reopening of salons around the world.
The deal, which is expected to close in the second quarter of Coty’s fiscal year 2022, will help the Gucci fragrance maker simplify its capital structure and save $52 million annually, while also boosting its profits.
KKR’s ownership in the Hugo Boss fragrance maker will be reduced to the equivalent of approximately 45 million Quoty Class A shares, representing a stake of approximately 5.2%. (Reporting by Praveen Paramasivam in Bengaluru; Editing by Krishna Chandra Eluri)