Coty to Buy Majority of China Skin-Care Company TJoy
Coty Inc., the seller of perfumes by Sarah Jessica Parker and Vera Wang, will acquire a majority stake in Chinese skin-care company TJoy Holdings Ltd. as it seeks to expand in the world’s most populous nation.
The companies entered into a share-purchase agreement, they said in a statement yesterday without disclosing the value of the deal. The Wall Street Journal reported on Dec. 3 that Coty would purchase TJoy for about $400 million in cash and stock.
TJoy is the fourth cosmetics acquisition New York-based Coty has announced in the past month, increasing competition for L’Oreal SA, the market leader, which bought Yue-Sai Cosmetics in China from Coty in 2004. TJoy would have been a “very good” target for L’Oreal, said Hermine de Brem, an analyst at Raymond James in Paris.
“Coty is going to be quite a competitor in make-up,” de Brem, who has a “buy” recommendation on L’Oreal shares, said by phone. “It’s really Coty’s goal to spend more and more” expanding that business.
Coty agreed to buy nail-care company OPI Products Inc., it said Nov. 29. The perfume maker owned by Joh A. Benckiser SE is buying beauty company Philosophy from private equity firm Carlyle Group and agreed to purchase German cosmetics firm Dr. Scheller Cosmetics AG.
Financial terms for the acquisitions haven’t been disclosed.
Coty’s sales grew 3 percent to $3.6 billion in its 2010 fiscal year and the closely held company employs 8,500 people, according to yesterday’s statement.
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