Coty Buys Into Direct Sales Trend With Acquisition

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Coty, the beauty company with brands including Max Factor and OPI nail polish, has taken a 60% stake in Younique, an online-based direct sales cosmetics firm.

The $600 million investment will see Younique’s founders, brother and sister Derek Maxfield and Melanie Huscroft, retain 40% of the company they founded in 2012, Coty said in a statement on Tuesday.

“We are thrilled to have Coty as a partner and expect that together we will be able to take Younique to new heights,” said Maxfield, Younique’s chief executive officer. “Coty and Younique share a passion for beauty, an entrepreneurial spirit, as well as complementary missions. I am very excited about this partnership and everything it can bring to Younique’s employees, presenters and loyal consumers across the world.”

Direct, or peer-to-peer, selling has jumped in popularity in recent years, with traditional firms in the business like Tupperware Brands (TUP) and Avon Products (AVP) vying with newer brands like fashion firm Stella & Dot and home fragrance company Scentsy. Sellers join online and are usually encouraged to host parties or shows to present the products, while being offered discounts and rewards.

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