Reports recently broke that Kylie Jenner is selling $600 million stakes in her beauty line to Coty Inc. Coty Inc. agreed to pay $600 million for a majority stake in Kylie Jenner’s cosmetics line. This is the latest move by the makeup and fragrance company to acquire trendy brands that appeal to a younger clientele.
About the Deal
According to reports, the deal will see the makeup and fragrance giants having overall responsibility for the portfolio. The deal will see Kylie Jenner of the Kardashian clan, leading creative efforts and communications efforts of the beauty line. The deal values Kylie Cosmetics, which Kylie Jenner, 22, started in 2015 as a line of lip kits when she was still a teenager, at about $1.2 billion.
Beauty Brands are Trying to Attract Younger Shoppers with New Acquisitions
Some of the biggest beauty companies have been on an acquisition spree in recent years. They have been acquiring beauty brands in the hope to attract younger shoppers with upstart brands. Estee Lauder Cos bought its remaining two-thirds stake in Korean skincare company Have & Be Co for around $1.1 billion on Monday and Japan’s Shiseido spent $845 million to buy clean beauty brand Drunk Elephant in October.
This deal is no different for Coty, by acquiring a majority stake in Kylie Cosmetics the makeup and fragrance giants is hoping to bolster its portfolio to attract younger shoppers. Coty has been under pressure to turn its business around. They took a $965 million write-down this year on brands it bought from Procter & Gamble in 2015. It’s in the first stages of a plan where it seeking a sale of its professional hair and nail brands, such as Wella, Clairol and OPI. According to the company, this deal with Kylie Jenner deal is a “key milestone” in Coty’s transformation into a more focused and agile company.