Today Coty Inc. announced the signing of a Memorandum of Understanding (MOU) with global investment firm, KKR, for the sale of a majority in Coty’s Professional Beauty and Retail Hair business, including Wella Professionals, Clairol, OPI, and ghd brands (together “Wella”).

Under the terms of the MOU, Coty will carve out “Wella” and its portfolio of professional brands into a standalone company in which KKR will acquire a 60 percent stake and Coty will retain the remaining 40 percent interest. Coty’s mass beauty business in Brazil will remain a fully owned business of Coty.

Sylvie Moreau, president of Coty Professional Beauty, commented: “We are thrilled with this announcement. KKR is one of the world’s preeminent investment firms with an exemplary track record of value creation. As a market leader with one of the strongest portfolios of brands in the professional beauty market, we believe this partnership opens up a new set of opportunities for ‘Wella,’ our people, and our brands.”

KKR is a pioneer of the global private equity model, with over 43 years of investment experience. The firm has a long track record of investing in branded consumer businesses, including the beauty sector. Its portfolio includes 109 companies with over $157 billion in annual revenues and employing more than 637,500 people. With a global footprint on all continents and extensive local networks, KKR has a proven ability to support global businesses.

Johannes Huth, Partner and Head of KKR EMEA, said: “We are excited to form this partnership to invest in Coty to support it through this period of unprecedented global uncertainty and allow it to emerge as a stronger, more agile business, and to acquire a majority stake in Wella, a market leader with a strong portfolio of brands in the attractive professional hair market where we see significant opportunities to accelerate growth in partnership with its experienced leadership team. We look forward to working towards the establishment of a lasting and value-creating strategic partnership.”

“In this year where Wella Professionals is turning 140 years old, I am proud and inspired at the prospect of Wella operating again as a standalone company. Partnering with KKR will propel our people and our brands into a bright and successful new future,” commented Moreau.

“This announcement represents a great milestone for our Wella North America organization. We are confident this partnership will bring new opportunities. In the meantime, we remain fully committed to supporting our customers and our industry as it bounces back from the COVID-19 crisis,” added Coty Professional North America President Sennen Pamich.

KKR is expected to own 60 percent of “Wella” and Coty 40 percent, subject only to completion of limited confirmatory due diligence and execution of definitive documentation. The agreement is expected to be signed by the end of May.

Coty acquired the Professional Beauty and Retail Hair brands in 2016 from Procter & Gamble.