Coty Inc (NYSE:COTY) is buying a chunk of Procter & Gamble’s (NYSE:PG) products on a massive deal.
The US maker of Calvin Klein and Chloe perfume will shell out $12.5 billion to buy P&G’s perfume, hair care and make-up businesses. The deal comes in light of stagnant or slumping sales for Coty over the last two years.
“We are getting critical mass around the globe with access to key markets such as Brazil, Japan and Mexico,” Coty Chairman and Chief Executive Bart Becht said.
The deal will save Coty $550 million but the company will take on 2.9 billion of P&G Beauty’s debt. 43 brands are being acquired—these amounted to $5.9 billion in sales, or 7% of P&G’s total revenue in fiscal 2013/14.
P&G’s 10,000 employees will join Coty’s 9,000.
COTY stock is down 4.68% Thursday. PG stock is down 0.41%.
