What happens when the person tapped to take over as your company’s CEO supposedly changes his mind at the last minute? Well, if you’re cosmetics company Coty, you pay him about a couple of million dollars.
Back in April, Coty (COTY) announced the hiring of Elio Leoni Sceti as its next chief executive, taking over for interim CEO Bart Becht. Formerly the CEO of European frozen foods company Iglo Foods Holdings, Sceti was set to take over as Coty’s CEO at the start of July. Now, the New York-based company says Becht will stay on as interim CEO and chairman at Coty.
Coty announced the succession plan changes on Tuesday in a press release that claims Sceti “has reconsidered and decided not to join Coty.” Also on Tuesday, a Coty filing with the SEC disclosed the fact that the company reached a “dissolution agreement” with Sceti that will pay its onetime future CEO $1.75 million in severance and buy back Sceti’s preferred stock, which is worth about $55,000.
Tuesday’s news comes as Coty has been reported to be the leading candidate to buy Procter & Gamble’s (PG) beauty products portfolio, which includes Clairol hair products and Cover Girl make up, in a deal that could be worth $12 billion. Coty currently makes a range of beauty products, including Calvin Klein and Marc Jacobs fragrances.
Coty said on Tuesday that “leadership continuity” is critical as it moves ahead with its new business strategy. Becht is the former CEO of consumer products company Reckitt Benckiser, which, like Coty, is controlled by German holding company Joh. A. Benckiser GmbH.