Cosmetics maker Coty is considering selling its business unit that houses hair and nail brands such as Wella, Clairol and OPI as part of its plan to gradually reduce its portfolio to reduce its debt and simplify its structure. The company also said it is exploring options for its Brazilian unit, including a divestiture, by shifting its focus to the fragrance, cosmetics and skin care businesses.
The cosmetics company has struggled to integrate about 40 beauty brands, including Covergirl and Max Factor, that it bought from Procter & Gamble (PG.N) in 2016, forcing it to take billions of dollars in writedowns and outline a four-year restructuring plan.
Coty’s professional beauty unit, which primarily sells hair and nail care products to salon professionals, raked in about $1.81 billion in annual sales and accounted for about 21% of its total revenue.
The unit, however, has seen falling sales in the last four quarters.
The company, which is majority owned by German conglomerate JAB Holdings, has hired Credit Suisse to run a sale process for the units, which generated about $2.7 billion in net revenue in fiscal 2019.
Earlier this year, JAB raised its stake in Coty to 60%, giving it a firmer grip on the company.
With Reuters information