Why Coty Stock Soared 20% Monday Morning
Shares of Coty (NYSE: COTY), a leading global beauty company, soared 20% Monday morning after the company announced a strategic transformation and definitive agreement with KKR.
The deal calls for Coty to sell a majority interest in its retail hair business to KKR. The deal values the businesses at $4.3 billion, and KKR will now own 60% of the brands that include the Wella, Clairol, OPI, and ghd brands, collectively known as Wella. With the deal for its Wella business, Coty is targeting a roughly $600 million net reduction in fixed costs over the next three years. In a press release Peter Harf, who will assume the role of chief executive officer, had this to say:
I've known Coty for a long time and there is a lot of potential within this company. I'm delighted to return to an active leadership role. We are all energized by the task ahead -- to lead Coty to the best it can be. Further, in KKR, we have a world-renowned investor that will work alongside us in transforming Coty.
Source Fool.com
