NEW YORK, United States — Coty Inc. agreed to buy the personal-care and beauty division of Brazil’s Hypermarcas SA for about $1 billion in cash, turning again to acquisitions to expand its burgeoning cosmetics line.
The New York-based company will use a combination of debt and cash on hand to pay for the transaction, according to a statement on Monday. The Hypermarcas beauty business generated $253.5 million in revenue last year with brands such as Risqué nail polish and Paixão skin-care products.
The move follows an agreement in July to acquire more than 40 Procter & Gamble Co. beauty brands, a $12.5 billion deal that’s poised to turn Coty into one of the world’s largest cosmetics companies. That transaction will be conducted as a Reverse Morris Trust, meaning P&G will spin or split off the business, which will then merge with a Coty subsidiary. It will add brands like CoverGirl and Max Factor to the Coty stable of products.
The Hypermarcas deal gives Coty a platform to sell its existing lineup in Brazil, as well as the products it’s getting from P&G. The Hypermarcas transaction is slated to close by the end of March, while completion of the P&G deal is expected in the second half of 2016.
By Nick Turner; editor: Kevin Orland.