US cosmetics giant Coty Inc yesterday struck a deal to buy a majority 60 per cent stake in privately held online cosmetics retailer Younique LLC for about $600 million in cash.
Coty will fund the acquisition through a combination of cash on hand and available debt. The transaction is expected to close during Coty's 2017 fiscal third quarter.
Post closing, Coty will hold 60 per cent, while Younique founders will own the remaining 40 per cent and Younique's founder and current CEO, Derek Maxfield, and chief visionary officer, Melanie Huscroft, will continue to run the company.
Founded in 2012 by Derek Maxfield and Melanie Huscroft, Younique is a peer-to-peer e-commerce platform sells its line of beauty products through 200,000 independent presenters to over 4.1 million consumers in 10 countries.
The company currently operates in the US, Canada, Mexico, Australia, New Zealand, the UK, Germany, France, Spain, and Hong Kong.
Coty said that Younique is expected to generate approximately $400 million in net revenues in 2016.
Camillo Pane, Coty's CEO, said, ''Derek and Melanie are tremendous entrepreneurs who have built one of the most engaging and fastest growing e-commerce companies in beauty. Alongside the rest of Younique's team and in partnership with their presenters, they have been able to impact the lives of millions of consumers across a number of countries with a mission to uplift and empower women.''
Derek Maxfield said, ''We are thrilled to have Coty as a partner and expect that together we will be able to take Younique to new heights. Coty and Younique share a passion for beauty, an entrepreneurial spirit, as well as complementary missions.''
Coty has recently gone on an acquisition spree and one of its recent big-ticket purchase was spending $12.5 billion to buy Procter & Gamble Co's 43 specialty beauty brands, including Clairol and Wella. (See: Procter & Gamble to sell its beauty brands to Coty for $12.5 bn)
New York-based Coty is owned by Vienna-based Joh A Benckiser, the German holding company that manages the interests of the billionaire Reimann family of Germany, who also owns a substantial stake in Reckitt Benckiser, the world's largest maker of household cleaners.
With annual turnover of around $4.6 billion, Coty was founded in Paris in 1904 by François Coty, who is credited with founding the modern fragrance industry.
The 108-year old company develops and manufactures beauty care products that include fragrances, toiletries, colour cosmetics, skin care, sun care, and personal care products. Its Jennifer Lopez perfume has raked in $1 billion in sales since being introduced in 2002.
The Coty brand portfolio is distributed in prestige and ultra-prestige stores and includes Calvin Klein, Davidoff, Jennifer Lopez, Sarah Jessica Parker, Adidas, Beyoncé Knowles, Celine Dion, David and Victoria Beckham, Esprit, Pierre Cardin, Playboy, Shania Twain, Stetson, and Tonino Lamborghini among others.