updated - October 26, 2020 Monday EDT
Coty, Inc. announced in a press release that it will be acquiring the personal care and beauty business of Hypermarcas S.A. for approximately $1 billion.
The acquisition gives Coty a critical mass platform in Brazil.
Hypermarcas' personal care and beauty business, a $235 million net revenue business as of 2014, holds leading positions in Brazil's highly competitive beauty and personal care market, according to the press release.
Brazil is the third largest beauty market in the world.
Coty adds in the press release that the personal care and beauty business has a state of the art manufacturing and distribution facilities in the state of Goias.
The facilities have a critical mass go to market capabilities and a proven management team.
Coty adds in the press release that these facilities, with all of their offerings, provide the company's small business and the larger Proctor & Gamble (P&G) Specialty Business an excellent platform for integration.
The merger of the Specialty Business of P&G into Coty is expected in the second half of calendar 2016.
Bart Becht, the interim CEO and chairman of Coty, said in the press release that they are excited with the acquisition of Hypermarcas' personal care and beauty business.
"We expect that the strength of the brands, the impressive leadership team and its robust infrastructure will enhance COTY's competitive position and very much complement our contemplated merger with the P&G Specialty Beauty Business," he said.
The Latin America Herald Tribune adds that after the acquisition, Hypermarcas will still have its disposable products and baby products business.
The business includes several brands od diapers, condoms, sweeteners, and skin treatments.
The Latin America Herald Tribune adds that Hypermarcas said in a statement that they plan to use the proceeds from the sale to reduce its debt.
The personal care and beauty business accounted for 20 percent of Hypermarcas' total sales.
Coty said in the press release that the transaction is subject to regulatory clearances and other customary closing conditions.
The company expects the deal to close in two stages by the end of March 2016.
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