Coty and Kylie Jenner have entered into a long-term strategic partnership in order to jointly further develop Kylie’s existing beauty business into a global brand. Together, both companies will set and lead the strategic direction of the partnership, focusing on global expansion and entry into new beauty categories. Kylie and her team will continue to lead all creative efforts in terms of product and communications initiatives, building on her global reach capabilities through social media.
Kylie is a personality with over 270 million followers across her personal and brand social media channels, as well as being an influential voice among beauty consumers globally. Both of her brands, Kylie Cosmetics and Kylie Skin, are two growing beauty brands on social media.
The transaction is part of Coty’s ongoing transformation into a more agile company. Coty will have overall responsibility for the portfolio’s development, leveraging its capabilities in R&D, manufacturing, distribution, commercial and go-to-market expertise, as well as its deep understanding of the fragrances, cosmetics and skincare categories. In addition to its responsibilities within the partnership, Coty will act as a licensee for skin care, fragrances, and nail products.
Through the partnership each party will leverage its unique strengths to further build a high growth, digitally native beauty brand.
Peter Harf, Chairman of the Board, said, “This new partnership between Kylie and Coty is an exciting step in Coty’s renewed emphasis on its beauty business. Kylie is a modern-day icon, with an incredible sense of the beauty consumer, and we believe in the high potential of building a global beauty brand together.”
Under the terms of the agreement, Coty will acquire a 51% ownership in the partnership for $600M. Coty expects the transaction will be accretive to the net revenue growth of its core fragrance, cosmetics and skin care portfolio by more than 1% p.a. over the next three years. The transaction is expected to be neutral to Coty’s earnings per share (EPS) in year one, and accretive thereafter. The ROIC of the transaction is expected to exceed Coty’s cost of capital by Fiscal 2023. Kylie Cosmetics realized an estimated $177M net revenues for the trailing twelve months (TTM).
The acquisition is expected to close in the third quarter of fiscal year 2020. All beauty categories within the new partnership will continue to be sold through leading luxury beauty retailers as well as owned digital channels.
About Kylie Jenner
Kylie Jenner has a over 270 million followers on social media. Featured as the youngest-ever self-made billionaire on the cover of Forbes Self-Made Billionaire issue in August 2018, Kylie is a entrepreneur, beauty mogul, fashion designer, author, TV personality and style icon. In November 2015, Kylie launched her cosmetics brand, Kylie Cosmetics. The debut product, the Kylie Lip Kit. Kylie has expanded the collection beyond lip products to include offerings such as eyeliners, eyeshadows, blushes, highlighters, concealers, brushes, and makeup bags as well as creating limited edition sets launched throughout the year. Kylie introduced Kylie Skin, a range of skincare products in May 2019. Kylie has a fashion brand with her sister, the Kendall + Kylie Collection.
For more information, please click here