Coty Inc. has sold its remaining 25.8% stake in Wella to KKR for $750 million, completing its plan to simplify its portfolio while reducing financial leverage.

Target Information

Coty Inc., an established name in the beauty industry, has successfully divested its remaining 25.8% stake in Wella, a leading haircare brand, to KKR managed capital accounts and affiliated investors. This strategic move follows a multi-year monetization plan initiated by Coty in 2020, aimed at simplifying its portfolio and maximizing the value of its investments in non-core assets. As part of the agreement, Coty receives an upfront cash payment of $750 million, alongside a 45% share of any future proceeds from Wella's potential sale or IPO, once KKR's preferred return is met.

This transaction is a culmination of Coty's commitment to financial realignment and debt reduction, which is expected to significantly strengthen the company's financial position. Following the completion of the sale, Coty anticipates decreasing its net financial leverage ratio to approximately 3x by the end of CY25, reinforcing its aim of achieving a leverage ratio of 2.0x.

Industry Overview

The beauty and personal care industry in the United States, where Coty operates, is notable for its resilience and growth potential. The market is characterized by a diverse range of segments, including skincare, haircare, makeup, and fragrance, which c