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Is Coty Selling Off Its Professional Beauty Business?

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OPI nail polishes

Coty's Professional Beauty business includes Wella, Clairol, OPI and ghd.

Coty is shifting its focus away from the professional beauty market to concentrate solely on its fragrance, cosmetics and skin care businesses.

Coty's Professional Beauty business includes Wella, Clairol, OPI and ghd.

The company has announced that it will begin to "explore strategic alternatives for its Professional Beauty business and associated hair brands, as well as the company’s Brazilian operations, including a divestiture."

The proceeds from a potential transaction will be used to pay down debt and return excess cash directly to shareholders, Coty stated. The potential sale is part of the company's previously announced turnaround plan

Despite its strong performance, the future growth opportunities of the Professional Beauty business lie increasingly outside Coty’s core strategic focus, the company added. 

Pierre Laubies, CEO of Coty, said, "After stabilizing our operations in fiscal 2019, we announced in early July a plan to turn around Coty’s performance. Today’s announcement accelerates this transformation and will help reposition Coty as a more focused and agile company, deleverage our balance sheet, and improve our ability to invest in areas with the greatest growth potential. The Professional Beauty teams have done an incredible job over the past three years in creating a strong business platform, putting us in the favorable position to find the best owner for that business while unlocking significant value for Coty shareholders and allowing us to further grow our core remaining businesses."