Coty Inc. Signs 5-Year Contract With IBM for Business Transformation Services

NEW YORK, NY -- Nov 29, 2005 -- Coty Inc., a leading global beauty company, today announced that it has signed a 5-year contract with IBM for procurement services across 14 countries in North America and Europe. This partnership is expected to deliver significant cost savings to Coty throughout the life of the contract by leveraging IBM’s global economies of scale and optimizing Coty procurement processes.

This initiative is key to Coty’s strategy of harmonizing its business processes globally and building on its "Spiral of Success" efficiency program, which aims to realize significant cost savings while optimizing business processes. In recent years, Coty has rapidly developed its core businesses through organic growth and acquisitions. The cost savings from the procurement project are expected to further accelerate Coty’s growth by freeing up capital to invest in existing brands and other acquisitions.

IBM will procure goods and services for Coty in areas such as business services, travel, facilities management, technology and telecommunications, marketing and logistics. Core to the project is the implementation of IBM’s complete Procure-To-Pay procurement solution which will be integrated into Coty’s systems. IBM’s solution will enable web-based requisitioning, automated ordering, timely monitoring of order status and efficient supplier payment.

"This agreement with IBM will help enable Coty to transform its business and provide synergies across its brands while improving profitability" says Bernd Beetz, Coty Inc. CEO. "We look forward to working with IBM, which has demonstrated a proven ability to deliver comprehensive procurement services that will benefit the Coty organization"

Elements of the overall IBM procurement solution include IBM commodity experts, a global contact center and accounts payable processing center supporting Coty suppliers and employees in six languages. Coty will have access to the full range of services at IBM’s existing procurement service delivery centers.

"Coty is a market leader known for its innovation and we are pleased to be supporting its strategic initiative with our procurement outsourcing capabilities" says Tony Cronin, General Manager, Business Transformation Outsourcing, IBM. "We are experiencing growing market demand for business process outsourcing services, and procurement services in particular. IBM offers a unique value proposition to clients like Coty by combining our sourcing experience, procurement process expertise and applications, and outsourcing capabilities to deliver significant cost reductions and long-term economic benefits"

The project will be rolled out in France, the United Kingdom, Germany, the Netherlands, Austria, Belgium, Italy, Spain, Ireland, Portugal, Switzerland, Monaco, the United States and Canada over the next 15 months.

About Coty Inc.
Coty Inc. is the largest fragrance company in the world and one of the leaders in global beauty with annual net sales approaching USD $3 billion. Coty Inc. operates in over 25 countries and sells its products in broad and select distribution channels in over 80 markets spanning the Americas, Europe and Asia.

Coty Inc., comprised of Coty Beauty and Lancaster Group, has a diverse portfolio of over 35 distinctive celebrity, designer and lifestyle brands. Top sellers include Calvin Klein, adidas, Rimmel, Davidoff, Lancaster, Jennifer Lopez, Jil Sander, Joop! and Kenneth Cole. Additional distinguished brands include Aspen, Astor, Baby Phat, Calgon, Celine Dion, Cerruti, Chopard, Chupa Chups, David & Victoria Beckham, Esprit, Exclamation, Isabella Rossellini, Jette Joop, Jovan, Marc Jacobs, mary-kateandashley, Miss Sixty, Miss Sporty, Nautica, Nikos, Pierre Cardin, Sarah Jessica Parker, Shania Twain, Stetson, the healing garden, Vanilla Fields, Vera Wang and Vivienne Westwood. For further information on Coty Inc. and its products, please visit www.Coty.com.

About IBM Business Consulting Services
With consultants and professional staff in more than 160 countries globally, IBM Business Consulting Services is the world’s largest consulting services organization. IBM Business Consulting Services provides clients with business transformation and industry expertise, and the ability to translate that expertise into integrated, responsive, on-demand business solutions and services that deliver bottom-line business value.

Over the past several years, IBM Business Consulting Services has developed industry-leading transformation consulting skills and delivery capabilities in key areas, including Human Resources, Financial Management, Customer Relationship Management and Procurement. For more information, visit http://www.ibm.com .

Contact Information

Hitesh Patel

Coty Inc.

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