Benzinga | Oct 1, 2021 03:55PM EDT

Coty To Sell 9% Stake In Wella To KKR

* Coty Inc (NYSE:COTY) has agreed to sell about a 9% stake in Wella to KKR & Co Inc (NYSE: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.