Coty Projects Higher Costs For P&G Deal, Orphan Brand Challenges

 
• By Lauren Nardella

Costs associated with integrating 41 P&G beauty brands are estimated to reach $1.2bn over the next four years, more than doubling Coty's projections when the mega-deal was announced last year, and investments will be needed to galvanize the currently under-supported orphan assets. However, Coty is projecting $780m in synergies and room for further growth as a $9bn beauty force to be reckoned with.

[Coty Inc.] has its hands full as it works to maintain its underlying business while integrating 41 Procter & Gamble Co.beauty brands – a more costly task than initially anticipated – all of which weighed on its fiscal 2016 third-quarter results.

However, the New York-based firm remains optimistic about its future prospects as it stands to emerge from the P&G transaction...

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