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Coty to Sell 3.6% Stake in Wella to IGF Wealth Management in $150 Million Deal

Published July 19, 2023
Published July 19, 2023

Coty announced that it has entered into a binding letter of intent to sell 3.6% of its Wella stake to investment firm IGF Wealth Management. The deal is expected to close in the next two months.

WHO: Founded in 1880 by Franz Ströher, Wella is a German haircare company headquartered in Geneva, Switzerland, specializing in the professional haircare sector. The business was controlled by Procter & Gamble from 2003 until Coty acquired the business in 2015, along with some 40 other P&G brands.

Founded in Paris in 1904, Coty is one of the world’s largest beauty companies with a portfolio of iconic brands across fragrance, color cosmetics, and skin and body care. Coty serves consumers around the world, selling prestige and mass market products in more than 130 countries and territories.

WHY: The transaction advances Coty's objectives to actively deleverage, including reaching its target of driving leverage towards 3x exiting CY23.

IN THEIR OWN WORDS: Laurent Mercier, Chief Financial Officer of Coty, said, "Today’s announcement is a milestone for Coty, as the partial monetization of our Wella stake reinforces the strength of our balance sheet, with no debt maturities in the next 2 years and our remaining Wella stake carrying an implied valuation of approximately $900 million. The expected transaction is a concrete step in our commitment to both fully divest our retained Wella stake and reach leverage of approximately 2x by end of CY25. Coupling this deleveraging with a best-in-class medium-term growth algorithm, an active capital return program, including $400 million in targeted future share buybacks, and the continued momentum in our business, it is clear that we are reinforcing Coty’s position as a beauty powerhouse.”


  • Coty expects to sell a 3.6% stake in Wella to IGF Wealth Management for $150 million, subject to the completion of due diligence, reflecting a 4% premium to the book value of Wella as of March 31, 2023.
  • Cash proceeds of the proposed transaction will be used to pay down debt. 
  • Coty will retain a 22.3% stake in Wella with an implied valuation of approximately $900 million. 
  • Coty remains on track to drive leverage towards 3x exiting CY23 and is committed to divesting the remaining 22.3% stake by CY25. 
  • In October 2021, Coty swapped around 9% of its stake in Wella with KKR for some of the cosmetic maker's shares the buyout firm owns, valuing the deal at $426.5 million.
  • In May 2020, Coty issued $750 million of convertible preference shares, and KKR is fully subscribing to the issue. These shares carried a coupon of 9% and were converted into Coty shares at $6.24, equating to a 20% premium to Coty’s closing stock price on May 8, 2020 at $5.20.

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