The empire of beauty to be divided like a cake. Possible sale of brands such as Gucci and Burberry

Coty Inc., a key player in the global beauty industry, is on the verge of a potential revolution. As WWD reports, the company is considering selling its strategic divisions. The stakes are high — brands include Gucci, Burberry and Rimmel.

The world loves a rumor, especially when it involves giants who have dictated the terms of the industry for decades. According to a recent article published by WWD, Coty Inc. – one of the most recognizable cosmetics companies in the world – is reportedly looking for buyers and considering a two-stage sale. Anonymous sources indicate that the scenario involves splitting the company into two main segments: luxury and consumer.

Guilty fragrance by Gucci / Gucci press materials

In the case of Coty , we are not talking about an ordinary cosmetics company, but one of the most recognizable and influential brands in the industry. The group's Luxury division includes such legends as Gucci , Burberry , Jil Sander and Hugo Boss . It is this segment that generates the greatest interest from potential buyers, including Interparfums , which is allegedly already in talks, especially about Burberry and Hugo Boss . And for good reason - the launch of Burberry Goddess in 2023 was the biggest success in Coty's history.

Goddess by Burberry, a brand of the Cóty cosmetics empire / Burberry press materials

On the other side is the Consumer division, which includes popular drugstore brands such as Covergirl , Max Factor and Rimmel London . This is a segment responsible for volume, but not necessarily for image prestige - and it is this one, as it turns out, that may have difficulty finding a buyer. However, this is not the only problem.

The biggest unknown in the whole puzzle remains the license for Gucci Beauty , which after decades may return to the brand's owner – Kering .

The company has been developing its own beauty division for years, preparing to take over after the license expires, scheduled for 2028. Given Kering's current troubles , this is highly likely. For future buyers, this is a key issue - is it worth investing in a division that could lose its most valuable jewel in three years?

In the background of this potential breakthrough, other tough decisions are playing out. Coty reported a 6% drop in revenue in the last quarter, to $1.29 billion , and the company’s shares are down more than 30% year to date. Added to that is the withdrawal from its investment in SKKN by Kim (a $71.1 million loss) and the uncertain future of Kylie Cosmetics , which failed to meet expectations despite an impressive valuation in 2019.