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Coty Acquires Hypermarcas’s Beauty Business

Brands like Risqué, Paixão and Biocolor are top sellers in Brazil.

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By: Christine Esposito

Editor-in-Chief

Coty Inc. has entered into a definitive agreement to acquire the personal care and beauty business of Hypermarcas S.A. for approximately $1.0 billion in cash. The transaction will be funded with a combination of cash on hand and available debt facilities.
 
The beauty business was a $253.5 million net revenue operation in 2014, with an offering of brands that hold leading positions in the highly competitive Brazilian beauty and personal care market, which is the third largest in the world.

“Today’s announcement is another step in our progression towards creating a pure-play global leader and challenger in beauty,” said Bart Becht, interim CEO and chairman of Coty.
 
Brands that Coty would acquire include:
 
•   Monange – a multi-category personal care brand (body care, hair care, female deodorant)
•   Risqué – the market leader in nail polish in Brazil
•   Bozzano – the market leader in men’s care in Brazil
•   Paixão – largest skin care brand in Brazil
•   Biocolor – a best-selling hair colorant in Brazil
 
The unit also comprises state of the art manufacturing and distribution facilities in Goias, with critical mass go to market capabilities complemented by a proven management team, according to Coty, and as a result, it provides an excellent platform to integrate the existing small Coty business as well as the larger Procter & Gamble specialty beauty business in Brazil.

The latter is expected to be merged into Coty in the second half of calendar 2016, subject to regulatory clearances and other customary closing conditions, the company noted.
 
 “We are excited to announce the acquisition of the Beauty Business of Hypermarcas, a leading beauty and personal care business in one of the world’s most important retail markets,” said Becht.  “We expect that the strength of the brands, the impressive leadership team and its robust infrastructure will enhance Coty’s competitive position and very much complement our contemplated merger with the P&G Specialty Beauty Business”
 
The transaction, which is subject to regulatory clearances and other customary closing conditions, isexpected to be closed in two stages by end of March 2016.

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