Coty To Sell 9% Stake In Wella To KKR - Coty (NYSE:COTY)

Coty Inc COTY has agreed to sell about a 9% stake in Wella to KKR & Co Inc KKR. As a consideration, Coty will redeem approximately half of KKR's outstanding convertible preferred shares and accrued dividends, or the equivalent of 47 million shares of its common stock in a transaction valued at roughly $426.5 million.
Coty will continue to own 30.6% of Wella, with a $1.38 billion implied value for the retained stake.
The transaction reflects a 50% appreciation in Wella's value since the closing of Coty's 60% sale of Wella to KKR in December 2020.
Upon completion of the transaction, KKR will reduce its ownership to the equivalent of about 45 million Coty Class A shares, representing an approximate 5.2% stake.
Coty expects to close the transaction in the second quarter of FY22.
Price Action: COTY shares are trading higher by 4.01% at $8.175 on the last check Friday.