Coty sells remaining 25.8% stake in Wella to KKR for $750M upfront

Coty (COTY) announced that it has sold its remaining 25.8% stake in Wella to KKR (KKR) managed capital accounts and investment affiliates. Under the terms of the transaction, Coty will receive upfront cash consideration of $750M and 45% of any proceeds from a further sale or an initial public offering of the business, after KKR’s preferred return has been met. The sale completes the program initiated in 2020 to simplify Coty’s portfolio and operations, while realizing the full value of its Wella business. Coty intends to use the vast majority of the Wella upfront cash proceeds related to this transaction, net of tax, to pay down its short term and long-term debt. Both the Wella proceeds and Coty’s strong free cash flow generation are expected to reduce Coty’s financial net leverage to ~3x by the end of CY25.