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Procter & Gamble Co. has set the final exchange ratio for the spin-off of its specialty beauty brands to Coty Inc.

The sale of 41 P&G beauty brands to Coty is structured as a Reverse Morris Trust transaction, under which P&G will spin off the brands into a subsidiary called Galleria Co. When that part of the transaction is complete, Galleria will merge with Coty.

On Wednesday, P&G said that it set the final exchange ratio for the exchange of P&G common stock with Galleria. Stockholders will receive 3.9033 shares of Galleria common stock for each share of P&G common stock accepted in the offer. A maximum of nearly 105 million shares of P&G common stock can be exchanged, the company said, and the offer expires at midnight on Sept. 29. The exchange started Sept. 1.

This step will separate P&G’s global fine fragrances, salon professional, cosmetics and retail hair color business, as well as other brands, transferring the assets to Galleria. When the exchange offer is over, Galleria will merge with Coty. P&G shareholders who participate will receive about $1.042 of Coty class A common stock for each $1 of P&G stock accepted in the exchange offer, according to P&G.

After the merger is complete, stock from the exchange from P&G shareholders is expected to comprise 55 percent of Coty’s class A shares, P&G said previously. The deal is expected to close in October.

Coty is taking over much of P&G’s beauty business as the consumer products giant looks to realign into 10 key categories. In beauty, P&G is holding onto some assets, such as Pantene and SK-II. Coty will pick up fragrance licenses for Hugo Boss, Gucci, Lacoste, Bruno Banani, Escada, Mexx, James Bond, Gabriela Sabatini, Stella McCartney and Alexander McQueen, as well as Cover Girl, Max Factor, Clairol Professional, Wella Professional and many other brands.

In order to manage the influx of brands, Coty will reorganize into three segments: Coty Luxury, which will be made up of prestige fragrance and skin care; Coty Consumer Beauty, housing color cosmetics, retail hair coloring and mass-market body care, and Coty Professional Beauty, which will provide services to hair and nail salon owners. After the deal closes, Camillo Pane will take over as chief executive officer, while Bart Becht, currently chairman and interim ceo, will remain chairman.

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