'Forbes' previously labeled Kylie Jenner a billionaire. Now, the magazine claims, she isn't
(Bloomberg) — Coty Inc. tumbled Friday after Forbes reported that Kylie Jenner allegedly provided the magazine with misleading financial information about her cosmetics brand.
Shares of Coty, which acquired a majority stake in Kylie Cosmetics last year, dropped 13% to close at $3.63, extending its 2020 decline to 68%.
The news report raises questions about one of Coty’s most visible brands as it seeks to overcome stagnating sales, changing consumer tastes and retail challenges caused by the coronavirus pandemic. The company, which took billions of dollars in writedowns last year, agreed this month to sell the Wella and Clairol brands to buyout firm KKR & Co. as part of a $4.3 billion deal, allowing it to focus on mass beauty and the Jenner brand. Last week, it launched the Kylie Skin beauty line in Europe.
Representatives at management company Jenner Communications and her publicist, Christy Welder, didn’t immediately reply to messages seeking comment, nor did Lisa Kessler, a spokeswoman for New York-based Coty.
“All I see are a number of inaccurate statements and unproven assumptions,” Jenner said Friday in one of several tweets responding to the Forbes report. “I can name a list of 100 things more important right now than fixating on how much money I have.”
Forbes spokesman Matthew Hutchison defended the report.
“Today’s extensively-reported investigation was triggered by newly filed documents that revealed glaring discrepancies between information privately supplied to journalists and information publicly supplied to shareholders,” he said in an email. “Our reporters spotted the inaccuracies and spent months uncovering the facts.”
Jenner, 22, a scion of the Kardashian family, became the world’s youngest self-made billionaire in March 2019 and agreed to sell a 51% stake in her cosmetics line to Coty in November. The $600 million deal valued her business at roughly $1.2 billion.
Some analysts questioned the price tag at the time and, on top of the recent writedowns, “any renewed suggestion they overpaid for Kylie Cosmetics will shake investors,” said Deborah Aitken at Bloomberg Intelligence.
The pandemic has diminished her net worth, leaving her with a fortune of less than $1 billion. Forbes said the social media star spent years inflating the size and success of her business to the magazine in order to boost its estimate of her wealth.
Jenner, in one of the tweets, said: “I’ve never asked for any title or tried to lie my way there EVER. Period.”