2010-11-23 | 09:49
Coty Inc. will acquire Philosophy from The Carlyle Group, a global alternative asset manager. A sale price was not disclosed, but Carlyle was said to be seeking $1 billion for Philosophy, which is expected to have 2010 sales of more than $200 million. The acquisition is expected to close next month.
According to Coty, the acquisition expands and diversifies the Coty Prestige division.
"Philosophy is one of the beauty industry's most prestigious brands and a fantastic addition to the Coty family," said Bernd Beetz, CEO, Coty Inc. "This acquisition will allow Coty to strengthen its presence in the skin care category, which is one of our key strategic objectives."
The purchase of Philosophy is only the latest move by Coty. Earlier this year, the company purchased Dr. Scheller's Manhattan nails and makeup, and is still rumored to be in the hunt for OPI. According to Colin Hession, managing director, Colin Hession Consulting and long-time Happi columnist, the deal makes perfect sense.
"The logic of Coty's three deals is reasonably clear. Get more critical mass in the core category of their mass division in Germany by buying Dr Scheller's Manhattan nails and makeup," explained Hession. "Move into high-end nails with OPI in the U.S., where professional nails is sort of akin to professional hair, in that it tends to represent the fashion end of the category. And make a move into prestige skin careóbut one has to ask whether U.S.-based Philosophy is a sufficiently distinctive franchise to provide a meaningful expansion route beyond prestige fragrance. Either way, Philosophy's previous owners, private equity firm, Carlyle, must be rubbing their hands..."