Coty and the buyout firm KKR & Co have entered into a strategic transaction for Coty’s Professional and Retail Hair business. To spearhead this strategic transformation Coty has appointed the current Chairman Peter Harf as CEO in his additional role.
In a definitive agreement, Coty and KKR have entered into a transformation that will deleverage its balance sheet, streamline its operations and strengthen its leadership team.
Under Coty’s Professional and Retail Hair business, including the Wella, Clairol, OPI and ghd brands (together as “WELLA”), valuing the business at $4.3 billion on a cash-and-debt-free basis. KKR will own 60% of this separately managed entity and Coty owns the balance 40%. KKR is investing $1 billion directly into Coty through the issuance of convertible preferred shares.
The sale of a majority interest in the Professional and Retail Hair business simplifies Coty’s portfolio allowing Coty to focus on its core Prestige and Mass Beauty businesses.
Coty’s current Chairman Peter Harf will be assuming the additional role of Chief Executive Officer (CEO) to spearhead this new association.
Harf commented: “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.”
Shares in Coty jumped 18% as it appointed its chairman Peter Harf as CEO to help spearhead a strategic turnaround plan of its business.
In his new role, Harf will be part of a new three-person Executive Committee to make sure that Coty takes the right steps to become a more profitable company and drive improvements across the business.
Apart from Harf, the other members of the Executive Committee will be Coty’s Chief Financial Officer, Pierre-André Terisse, and Gordon von Bretten, who joined Coty recently as the company’s first-ever Chief Transformation Officer (“CTO”).
