US beauty and fragrance giant Coty (NYSE:COTY) Inc. has raised $356 million through a second listing on Euronext Paris, selling 33 million shares at $10.80 each, a 2% discount to Wednesday's close in New York. The shares began trading on the Paris exchange later on Thursday.
The decision by Coty, which has French roots dating back to its founding in 1904, to list in Paris underscores the city's growing appeal as a global center for luxury stocks. Major players in the sector, such as LVMH, L’Oreal SA, Hermes International (OTC:HESAF) and Kering (EPA:PRTP) SA, are traded on Euronext Paris, fostering an ecosystem of analysts and investors with deep industry knowledge.
Coty’s Chief Financial Officer Laurent Mercier stated that the company has recently drawn significant interest from leading investors across Europe, particularly in France. This recent influx of European investment is expected to ensure liquidity for the company's shares in Paris and diversify its shareholder base.
Mercier also noted that demand for Coty’s offering significantly exceeded the size of the share sale. He further outlined the company's plans to use the proceeds from the share sale to pay down debt and fund general corporate purposes, which include strategic investments in its business, working capital, and capital expenditures. This aligns with InvestingPro Tips that indicate strong earnings should allow management to continue dividend payments, and that the company has consistently increasing earnings per share. For more insightful tips, visit InvestingPro which offers additional 9 tips for Coty.
The offering was coordinated by BNP Paribas (OTC:BNPQY) SA, Credit Agricole (OTC:CRARY) SA, Citigroup Inc (NYSE:C)., and Banco Santander SA (NYSE:SAN). The shares of Coty's Class A Common Stock were admitted to listing and trading on Euronext Paris following approval by France's financial market authority, the Autorité des marchés financiers.
According to InvestingPro data, Coty has a market cap of 9420M USD and a P/E ratio of 18.84, with a revenue growth of 4.71% and gross profit margins impressively standing at 63.88%. The company's stock price took a hit over the last week with a -10.19% return, yet it still maintains a positive year-to-date return of 28.74%.
Coty also revealed plans to manage its outstanding share count through discretionary settlement of one or more of its outstanding total return swaps over the next six months. It did not disclose any definitive transaction at this time. The company, which is one of the world's largest beauty companies with a portfolio of iconic brands across fragrance, color cosmetics, and skin and body care, called its move a return to “the historic home of beauty.”
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