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Sep 26, 2023

French cosmetics maker Coty pushes forward with Paris-New York dual listing

Heavily indebted firm hopes listing in France will appeal to beauty-focused investors

French cosmetics manufacturer Coty has confirmed it will issue 33 mn shares as part of its plans to launch a dual listing in Paris and New York, as the heavily indebted firm hopes to snag beauty-focused investors.

The makeup company, which sells lines including Max Factor and Cover Girl, will offer shares to the public in the US and via private placements for institutional investors on the Euronext exchange for the first time, subject to approval from French regulator the Autorité des marchés financiers.

The company is already publicly traded on the NYSE, where its securities have been listed since 2013.

The move comes after the cosmetics and fragrance maker, founded in Paris in 1904, said in May that it was mulling a dual listing in Paris as it hopes to tap into investor interest in a market famous for its luxury goods companies, including LVMH and L’Oreal. The company plans to use the proceeds from the share offering to lower debt and invest in its business. BNP Paribas, Crédit Agricole, Citigroup and Santander are jointly acting as bookrunners for the offering.

Coty has been struggling with frequent management turnover and heavy borrowing. In July, the company’s chief executive Sue Nabi said she believed there were a lot of investors in Europe willing to invest, however.

The beauty veteran was hired in 2020 in a bid to revamp the company’s operations and became its fifth chief executive in as many years. Since her appointment, Coty’s share price has nearly tripled in value from being traded at lows of below $4 to more than $11.80 today.

Last week the company raised its annual sales forecast on the back of higher prices and strong demand, particularly for products made by its high-end division, which houses makeup and perfume from brands such as Hugo Boss, Gucci and Burberry.

Coty has been boosted by a post-pandemic boom in demand for beauty products as customers spend more on smaller luxuries like fragrances and cosmetics, even as persistently high inflation has dented spending on discretionary products globally.

Speaking when that forecast was made in September, Nabi said: ‘The success of Burberry Goddess across key markets confirms that Coty is the go-to destination to create winning fragrances and execute unique and disruptive campaigns.

‘Having spent the past three years strengthening Coty’s fundamentals and elevating Coty’s organizational capabilities across our categories, we enter the next phase of growth with best-in-class innovation and marketing power.’ 

Laurie Havelock

Laurie has been part of the IR Magazine team for more than a decade, starting out as a reporter and research editor before becoming editor in 2023. He was previously acting business editor at the i newspaper and deputy business editor at The Daily...