Shares of Coty Inc. (COTY - Get Report) surged Tuesday after premium consumer-brand investor JAB Holding Co. said it plans to boost its stake in the company by acquiring an additional 150 million Coty shares.
Coty shares rose 12.5% to close at $10.87 in trading on the New York Stock Exchange.
In a note to Coty shareholders, JAB said it plans to proceed with an offer for affiliate JAB Cosmetics B.V. to acquire an additional 150 million additional shares of Coty Class A common stock at a price of $11.65 a share in cash.
If approved, combined with its current holdings, JAB will own approximately 60% of Coty, JAB said. The offer is subject to approval of Coty's independent directors, JAB said.
JAB is already Coty's largest shareholder, holding a 40% stake in the New York-based company.
New York-based Coty develops, manufactures, markets and distributes fragrances, skin care, nail care, hair care and cosmetic products, including the CoverGirl and Clairol makeup brands.