Kylie Jenner Rumored to Reclaim Majority Stake in Cosmetics Brands Sold to Coty
In a move that has sent shockwaves through the beauty industry, reports have surfaced suggesting that both Kylie Jenner and Kim Kardashian, the two prominent members of the Kardashian-Jenner family, are engaged in discussions to regain ownership of their respective cosmetics brands—Kylie Cosmetics and SKKN by Kim—from Coty Inc. This potential buyback comes after a history of disagreements over various aspects of the brands' management and valuation following the initial sale in 2020.
The Unveiling of Negotiations: Bloomberg's recent report has revealed that Kylie Jenner and Kim Kardashian are actively negotiating to repurchase the shares of their makeup and skincare lines that they had sold to Coty Inc. in a substantial deal back in 2020. At that time, Kylie Cosmetics and SKKN by Kim were sold for staggering amounts of $1.2 billion and $200 million respectively, marking a significant chapter in the beauty industry's history.
A Tale of Diverging Paths: Sources indicate that tensions had been simmering between the celebrity entrepreneurs and Coty since the acquisition. These disagreements revolved around issues like price, brand valuation, and management decisions, ultimately leading to a potential estrangement between the brands and the beauty conglomerate.
Kylie Jenner, the entrepreneur behind Kylie Cosmetics, had relinquished a 51% stake of her brainchild to Coty in the 2020 deal. This landmark move was met with mixed reactions, as it marked the merging of a personal brand with a corporate entity in a deal worth billions. Similarly, Kim Kardashian's foray into the beauty world, SKKN by Kim (previously KKW Holdings), was also a part of Coty's acquisitions, with the reality star selling 20% of her stake for a substantial $200 million.
The Evolution of Kylie Cosmetics and SKKN by Kim: In the wake of these acquisitions, Coty undertook significant efforts to reinvigorate the brands. For Kylie Cosmetics, a re-launch was orchestrated, introducing new formulations and an enhanced online presence. The move wasn't limited to the digital realm; Coty also expanded the brand's footprint by placing its products in brick-and-mortar stores—a monumental shift from the brand's original online-only approach. The results of these endeavors were tangible, with the brand witnessing double-digit growth in the last quarter, as reported by Bloomberg.
On a similar note, Kim Kardashian's beauty venture, now rebranded as SKKN by Kim, also went through a transformation under Coty's ownership. However, Kim's journey to reclaim a stake in her brand has been underway for some time, with discussions reportedly initiated as early as July, according to The Wall Street Journal.
Implications for the Industry: The potential buyback of these prominent cosmetics brands by their original founders could have far-reaching implications for the beauty industry. It signifies the power of individual brand ownership and creative control in an industry often characterized by conglomerates. The negotiations also underscore the complexities that arise when celebrity personal brands intersect with corporate structures, raising questions about artistic direction, brand identity, and financial ownership.
As discussions between Kylie Jenner, Kim Kardashian, and Coty unfold, the beauty industry holds its breath, awaiting the outcome of this monumental negotiation. Regardless of the final decision, this saga serves as a testament to the influence and resilience of individual entrepreneurs within the larger framework of the cosmetics world. Whether these iconic brands return to their founders' hands or remain under the umbrella of a corporate giant, their impact on the industry will undoubtedly endure, shaping the future of beauty for years to come.