Coty to merge with P&G Beauty Brands (PG), anticipated meaningful EPS accretion due to ~$780 mln of cost synergies; expected to close Oct 2016
- Estimated cost savings have been increased to approximately $780 million annually, or 16% of acquired revenues, after the next four years, a very substantial increase from the estimate provided in July 2015
- The P&G Beauty Brands, supported by the total expected synergies, is expected to add approximately 600 bps to the Coty stand-alone operating profit margins over a 4-year period
- Estimated to increase Coty's fiscal 2015 adjusted earnings per share, excluding the impact of amortization, by approximately $0.49 to $0.54
- To realize the cost synergies and close the transaction, the Company is anticipating to incur one-off costs of approximately $1.2 billion over the next four years
- Following the close of the transaction, the annual dividend is expected to increase to $0.50 per share