Peter Harf is becoming Coty Inc.’s chief executive officer, and the KKR-Wella deal has moved a step closer to closing.
Harf, who is the founding partner of Coty’s majority owner JAB, steps in for Pierre Denis, the former ceo of Jimmy Choo, who was slated to take over as Coty ceo in early June and who will not now be joining the company. Denis joined the board of Coty in October, and was slated to be the company’s first ceo with prior beauty experience in years. Denis is stepping down from Coty’s board but will remain a senior adviser.
Harf has led Coty before, when he was ceo from 1990 to 2001. He was also chairman until 2011.
In a statement, Coty said “leadership changes will instill urgency and deliver results.”
In addition to the Harf-Denis swap, Coty has created a three-person executive committee consisting of Harf, chief operating officer and chief financial officer Pierre-André Terisse, and Gordon von Bretten, who just joined Coty from KKR as the company’s chief transformation officer.
Pierre Laubies, Coty’s most recent ceo, left as of May 31.
“I’ve known Coty for a long time and there is a lot of potential within this company,” Harf said in a statement. “I’m delighted to return to an active leadership role. We are all energized by the task ahead — to lead Coty to the best it can be. Further, in KKR, we have a world-renowned investor that will work alongside us in transforming Coty.”
At the same time as unveiling another major executive move, Coty said it had reached a definitive agreement with KKR for the private equity firm to take majority ownership of Wella, Clairol, OPI and Ghd, which values the businesses at $4.3 billion.
The brands will be put into a separate company, and KKR will own 60 percent, with Coty owning 40 percent. KKR is also investing $1 billion directly into Coty through the issuance of convertible preferred shares.
That investment, plus $2.5 billion in anticipated net cash proceeds from the closing of the Wella deal, is expected to reduce Coty’s leverage and give the company increased financial flexibility. Johannes Huth, partner and head of KKR EMEA, will join Coty’s board.
Coty maintains the deal will allow the business to simplify operations and focus on prestige and mass, but some have had doubts as the company will still own a stake in the businesses it once aimed to shed entirely.
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