Coty gains after returning Gucci Beauty license for $400 million

Coty

08/07/2026 12:00

** CoverGirl owner Coty's COTY.N shares up about 6% at $2.36 premarket
** On Tuesday, COTY agreed to return Gucci Beauty license to French luxury goods firm Kering PRTP.PA for about $400 million, ending the agreement about a year early
** Transaction includes $250 million upfront payment, $150 million due by September 30, 2027, and up to $30 million in performance-based incentives designed to ensure a smooth transition
** COTY will continue operating Gucci Beauty through at least June 30, 2027
** "We view the agreement as a more favorable outcome than allowing the license to run to expiration" - Jefferies 
** Brokerage adds that early transition is not entirely surprising, as management previously indicated it would be open to an accelerated Gucci exit if it created shareholder value
** As of last close, stock down 5% YTD  

 (Reporting by Koyena Das from Bengaluru)
 ((Koyena.das@thomsonreuters.com))