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Buyout-backed fragrance giant Coty could raise $1.2bn in IPO

28 May 2013

perfumePrivate equity-backed perfume maker Coty is planning to raise up to $1.2bn from an IPO which could see it part with more than 65 million shares.

Berkshire Partners and Rhône Capital are set to drop their stakes in the business from 7.1 per cent to 6.6 per cent through the offering, which will see them part with just over 6.7 million shares each if the underwriters take up their full 8.6 million over-allocation.

Coty, which was founded in Paris in 1904, controls brands in the fragrance, colour cosmetics and skincare sectors including Calvin Klein, Davidoff and Rimmel, and had net revenues of $4.6bn in fiscal 2012.

That was well up on the $3.5bn net revenue it recorded in fiscal 2010, although the company also made a $324m net loss in financial 2012.

Coty had a $10.7bn bid for Avon Products last year on the grounds it undervalued the business.

The business has priced its shares at between $16.50 and $18.50 each, and plans to list on the New York Stock Exchange.

Joint book-running managers for the offer are BofA Merrill Lynch, JP Morgan, Morgan Stanley, Barclays, Deutsche Bank Securities and Wells Fargo Securities.

Lead managers are Lazard Capital Markets, Piper Jaffray and RBC Capital Markets.

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