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Coty Signs Deal to Acquire Dr. Scheller Cosmetics

Acquisition will grow Coty's market share in Germany.

Coty Inc. has added more depth to its burgeoning color cosmetics portfolio with the acquisition of the German-based Dr. Scheller Cosmetics AG from the Kalina Group, a Russian beauty company.

Coty said Thursday it has signed a deal to acquire 100 percent of the shares in DSC, which includes the leading German makeup brand Manhattan and its anti-acne line, Manhattan Clearface.

Coty said this acquisition will grow its market share in Germany, a key area for the company, from 7 percent to 17 percent, making Coty the second biggest player in color cosmetics in Germany, behind L’Oréal.

Coty did not disclose the terms of the deal, nor did it break out the sales figures of DSC. But industry sources estimate that the German brand does roughly $70 million at wholesale.

It was learned that the DSC purchase increased the percentage of its business Coty does in color from 23 percent to 25 percent. The company noted that the acquisition also paves the way for Coty to realize its ambition of being a $7 billion business by 2015. At the end of the fiscal year, Coty’s sales stood at $3.6 billion. Now, after one of the best quarters in its history and this acquisition, net sales are “nearly $4 billion,” the company said.

“The acquisition of Dr. Scheller Cosmetics is a natural extension of our strategy to offer a well-balanced portfolio of brands, representing some of the leading consumer products in Germany,” stated Bernd Beetz, chief executive officer of Coty Inc. “Their well-established brand, high-quality products, market presence and loyal consumers will complement and add value to Coty’s existing offerings.”

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Alexander Petrov, ceo of OJSC Concern Kalina, added, “We are proud of what we have been able to accomplish since acquiring Dr. Scheller Cosmetics AG, restructuring the company and bringing it to profitability. We are confident that the company will continue to grow under Coty’s leadership. However, we will continue to maintain ownership of Dr. Scheller Das Natukonzept product line, which we intend to grow as an international brand.”