Coty closes two plants, formerly owned by Del Laboratories

By Guy Montague-Jones

- Last updated on GMT

Related tags: Rocky point, English-language films, Coty

Coty is closing two manufacturing plants in North Carolina to protect its profits against the financial fallout from the recession.

Both were previously owned by Del Laboratories, which was acquired by Coty at the end of 2007. Coty had hoped the acquisition would help the company fulfill its ambition of passing the $5bn turnover mark by 2010.

Job losses

A total of 510 full-time workers are now set to lose their jobs when the former Del Laboratories-owned facilities at Leland and Rocky Point close their doors.

According to local press reports, 420 jobs will be lost at the Rocky Point plant, which will be gradually shut down over the next year. The facility is currently used to manufacture nail colour and nail treatment lines.

The Leland plant, which serves as a processing center for customer returns and promotional products will be closed down by the end of the year, with a loss of 90 jobs.

While both these North Carolina facilities will be shut down, Coty’s distribution center in Rocky Point will remain open.

Original acquisition

The facilities had all come into the Coty fold in 2007 and initially the celebrity and designer fragrance specialist had been upbeat about the acquisition.

Last fall, when Coty announced that its sales for the fiscal year had rocketed 23 percent to $4bn, the company said the Del Laboratories acquisition had strengthened its presence in color cosmetics and nail care.

At the time CEO Bernd Beetz said more strategic acquisitions were planned as part of its aggressive growth strategy.

Since then the recession has eaten into demand and it remains to be seen whether Coty will hit its $5bn target by 2010. Nobody from Coty was available to comment before publication.

Related topics: Business & Financial

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