The unit could draw bids of as much as $8 billion, Bloomberg News reported.
The people familiar expect those firms to make first-round bids, which are due in the first week of March.
Germany’s Henkel (HENKY) , which makes adhesives and shampoos, also is mulling a bid, the sources said.
The European investment firm JAB Holding owns a controlling stake in Coty, which makes brands including Clairol and CoverGirl.
In October, the beauty company said it would divest its hair-care and professional beauty units, which contribute almost a third of its revenue. Coty said it would also seek to unload its Brazil operation.
Morningstar analyst Rebecca Scheuneman said in a report from Sunday that “Coty's brands (CoverGirl, Clairol) have suffered from underinvestment at a time many new brands entered the market.
“While Coty's recent investment in Kylie Cosmetics should help stabilize segment sales, we are not confident the brand's strength will be sustained, as celebrity popularity tends to be fickle.
"Collectively, Coty has not demonstrated brand strength, preferred relationships with its channel partners, or a cost advantage; thus it does not possess an economic moat.”
She told TheStreet on Wednesday that the current deal doesn’t change her opinion.
“I expect Coty will receive about $6 billion in proceeds for the sale of their professional and Brazilian hair care businesses,” she said by email.
“This represents an enterprise value to Ebitda multiple of 12-13 times, which is in line with previous similar transactions.”
Scheuneman puts the fair value of Coty shares at $9.30.
The stock has been up and down a bit in Wednesday trading. At last check it traded at $11.51, off 0.3%.
The author owns shares of Procter & Gamble