What happened? Last night, post European market close, news reports (e.g. WWD, Reuters, Bloomberg) suggested that Coty Inc is exploring a potential sale in two parts (Luxury and Consumer). The company is said to be in talks with Interparfums SA regarding the potential acquisition of some of its fragrance brands (see Coty and Interparfums). What is Coty? In FY24 (June y/e), Coty generated sales of USD6.1bn, EBIT (co. defn.) of USD0.9bn (14.1% mgn.) and EBITDA (co. defn.) of USD1.1bn (17.8% mgn.). 63% of Coty''s FY24 sales were generated in Prestige (57% in Fragrances) and 37% of Coty''s FY24 sales were generated in Consumer Beauty (17% in Makeup, 7% in Mass Fragrances, 6% in Nail, 6% in Body Care). None of its brands account for over 10% of sales. Some of its brands include Boss, Burberry, Calvin Klein, Chloe, Covergirl, Gucci, Kylie, Max Factor, Rimmel and Sally Hansen. We estimate that c.2/3rd of Coty''s FY24 revenues were generated through brand licenses. Implications for EU Beauty (and beyond) Below we outline the likely implications for the European Beauty players (and also broader EU Staples): . Beiersdorf (=): While Beiersdorf has the financial wherewithal to finance a material acquisition (we forecast FY25e net cash of USD4.6bn), we believe it is extremely unlikely to have interest in either side of Coty''s business. Beiersdorf has historically tended to engage in bolt-on Skincare focused acquisitions and has no meaningful presence in Fragrances; . Henkel (=): We believe that Henkel has historically had interest in acquiring Wella (see Revisiting Wella) which is c.22% of which is owned by Coty (the remainder is owned by KKR), yesterday''s reports may fuel speculation that it may have interest in seeking to acquire the business; . L''Oreal (-): While L''Oreal may have interest in acquiring selective Coty brands (e.g. Chloe?), we very much doubt whether it would have any interest in acquiring the entirety of either Coty''s Prestige or Consumer...