Reports: Coty snaps up beauty lines from P&G for $12B
CINNCINATI — Published reports are noting that beauty brand Coty has reportedly bolstered its portfolio by winning an auction process for three parts of Procter & Gamble’s beauty business for a value that could reach $12 billion.
The deal reportedly includes fragrances (Hugo Boss, Gucci, Dolce & Gabbana), color cosmetics (Cover Girl and Max Factor), and hair care (Wella and Clairol).
Citing sources, the New York Post reported that Coty has spoken to bankers in recent days about acquiring P&G’s divisions through a Reverse Morris Trust. That move would save P&G from paying capital gains taxes on the deal, according to the report, and P&G would sell just under a majority stake to Coty and let Coty run the combined business.
Both P&G and Coty have declined to comment.
For P&G, the move is part of a larger effort to narrow its focus on faster-growing brands. Last year, P&G shed its Duracell battery business in a deal valued at $4.7 billion, and also divested its pet business.
For Coty, which has undergone organizational changes in recent years, such a deal would mark its foray into the hair care business with the Clairol and Wella brands.
According to a Reuters report, Wells Fargo analyst Chris Ferrara said such a deal would be “transformational” for Coty and estimated it would increase its revenue to nearly $11 billion from $4.4 billion.
In a research note, Morgan Stanley analyst Dara Mohsenian acknowledged, “We have no knowledge of a potential deal other than that which was stated published in recent press articles.”
However, based on a preliminary analysis, Mohsenian estimates “the potential acquisitions could be ~60% EPS accretive to Coty, and even ~30% assuming no synergies. In terms of the details, based on our $1.2B EBITDA estimate for the combined businesses, the implied purchase price of 10 times EV/EBITDA was below our prior ~13 times expectation, which is good news for Coty, and we also did not expect Coty to acquire Wella, given their lack of track record in hair care.”
Added Mohsenian, “Bottom line, for Coty, while the market has been pricing in some probability of a deal, the accretion would likely be greater than expected and should be perceived as a significant positive. For P&G, the potential purchase price is lower than we expected given a heated M&A environment, but tax efficiencies under an RMT structure would make the tax effective purchase price near our 13 times expectation.”
Dove Men+Care celebrates Father’s Day with ‘First Fatherhood Moments’ campaign
ENGLEWOOD CLIFFS, N.J. — This Father’s Day, Unilever’s Dove Men+Care is launching the “First Fatherhood Moments” campaign to celebrate the emotion, strength and happiness dads openly express upon learning they are going to become a father.
Reflective of the increase in dad’s sharing more content online today, the heart of the campaign is captured in a new film, which shares the reaction of fathers-to-be in the first moments they find out they are going to be a dad. Comprised of personal online clips from the lives of 13 real dads, the film portrays their authentic and unfiltered reactions, and offers genuine insight into the moment when a man learns his life has changed forever.
“Fatherhood has evolved from previous generations, with men drawing strength and fulfillment from their caring roles. In fact, 88% of men feel that taking care of their family makes them feel strong,” stated Jennifer Bremner, director of marketing for Unilever. “Our brand has seen this displayed through the personal experiences dads are sharing online. In celebration of Father’s Day, we collated moving moments from real men to show the world that a dads’ care begins from the very first instant he finds out he’s going to be a dad.”
Kid’s sunscreen touts benefits of early use
NEW YORK — Actor Hugh Jackman has taken on a new role — sun care innovator.
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Jackman and his business partner, Chris Clarke, have developed a new sun care line for children called Pure Sun Defense. Jackman was initially diagnosed with basal cell carcinoma in November 2013 and has since used his personal social media to emphasize the importance of wearing sunscreen.
Pure Sun Defense is geared toward children ages 3 years to 14 years old. As studies show, children under the age of 10 years who don’t apply sunscreen are 50% more likely to develop skin cancer as adults versus children who do apply sunscreen, according to the company.
To further engage children, Pure Sun Defense forged partnerships with Marvel, Disney and Universal studios that bring favorite characters to sun care from movies, including “The Avengers,” “Spider-Man,” “Despicable Me,” “Frozen” and “Princesses.”