- Multinational beauty company Coty announced it is buying a 51% stake in Kylie Jenner’s cosmetics business for $600 million
Multinational beauty company Coty — which is known for brands like Clairol, CoverGirl, Burberry fragrances, and Marc Jacobs Fragrances — is buying a 51% stake in Kylie Jenner’s cosmetics business for $600 million. This deal values Jenner’s company at $1.2 billion. And this deal will enable “global expansion and entry into new beauty categories.”
“I’m excited to partner with Coty to continue to reach even more fans of Kylie Cosmetics and Kylie Skin around the world,” said Jenner in a statement. “This partnership will allow me and my team to stay focused on the creation and development of each product while building the brand into an international beauty powerhouse.”
Jenner — who has been named by Forbes as the youngest “self-made billionaire” at the age of 22 — is going to remain the face of Kylie Cosmetics and Kylie Skin. The growth of these brands are largely attributed to Jenner’s massive follower base of 270 million people on social media. As part of the Kardashian family, Jenner started these brands when she was a teenager.
“Combining Kylie’s creative vision and unparalleled consumer interest with Coty’s expertise and leadership in prestige beauty products is an exciting next step in our transformation,” added Coty CEO Pierre Laubies.
Coty is going to use its R&D, manufacturing, distribution, and commercial resources for expanding Jenner’s business. Coty generates $9 billion in net revenue across its beauty brands. And Coty will have a 51% controlling stake in the beauty brands. The ROIC of the transaction is expected to exceed Coty’s cost of capital by fiscal 2023. And Kylie Cosmetics realized an estimated $177 million net revenues for the trailing twelve months (TTM).
“This new partnership between Kylie and Coty is an exciting step in Coty’s renewed emphasis on its beauty business,” explained Coty Chairman of the Board Peter Harf. “Kylie is a modern-day icon, with an incredible sense of the beauty consumer, and we believe in the high potential of building a global beauty brand together.”
Tiger Chark served as an advisor to Coty on the transaction. Led by Dave Young, Matt Hallinan, Bram Couvreur, and Alexandra Cotter, Cooley advised King Kylie LLC (aka Kylie Cosmetics). And the deal is expected to close in the third quarter of the fiscal year 2020.
Featured image credit: Kylie Cosmetics
