Melvin Capital Doubles Coty Stake as KKR Unloads Its Shares
Melvin Capital Boosts Coty Stake as KKR Unloads Remaining Shares
(Bloomberg) -- Gabe Plotkin’s Melvin Capital Management has more than doubled its holding in Coty Inc. as private equity firm KKR & Co. unwound its stake in the cosmetics maker.
Melvin now owns 5% of New York-based Coty, including 21.7 million common shares and options to acquire an additional 19.5 million, according to a filing Wednesday. The money manager held 10 million shares at the end of June, data compiled by Bloomberg show.
Demand for Coty makeup and fragrances is rebounding as pandemic restrictions ease. Its shares surged this week after the company posted a profit that beat Wall Street estimates.
Read more: Coty Jumps After FY Adjusted EPS Forecast Beats Estimates
Melvin’s stake reached the 5% reporting threshold Tuesday while KKR exited its remaining investment through the sale of about 20 million shares. Part of KKR’s holding was sold at a discount of as much as 4.26% to that day’s closing price.
Melvin didn’t buy any of the Coty shares sold by KKR, according to a person familiar with the matter.
Plotkin, 42, ranked among Wall Street’s most successful traders until January, when his hedge fund tumbled more than 50% amid a social media campaign orchestrated by retail traders to push up stocks that his firm had wagered against.
Melvin, which managed $12 billion as of Nov. 1, has since recouped some of those earlier losses. The firm generated a 35% return from the beginning of February through the end of October, the person said.
©2021 Bloomberg L.P.