NEW YORK (TheStreet) -- Procter & Gamble (PG) shares are up 1.46% to $79.26 in pre-market trading on Tuesday after the company announced that beauty products manufacturer Coty (COTY) won an auction to purchase three business from P&G for up to $12 billion.
Coty won an auction for two businesses related to its fragrance and beauty product operations as well as a third auction for P&G's hair care business.
Some of the brands Coty gained in the auction include Max Factor, CoverGirl and Wella.
Procter & Gamble began informing Coty and other bidders of the result of the auction over the weekend.
Coty has reportedly spoken to bankers about facilitating the purchase through a Reverse Morris Trust that will save P&G from paying any capital gains taxes on the deal, according to the New York Post.
TheStreet Ratings team rates PROCTER & GAMBLE CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate PROCTER & GAMBLE CO (PG) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself."