JAB seeks to buy controlling stake in CoverGirl maker Coty

European conglomerate JAB Holdings is seeking a majority stake in Coty Inc., which makes CoverGirl, Max Factor and Hugo Boss brand cosmetics and fragrances.

JAB is offering to buy up existing stock from shareholders at $11.65 per share, marking a 20 percent premium from its closing on Monday. Specifically, it's hoping to buy up to 150 million shares which would boost its stake from 40 percent to 60 percent.

Coty's board of directors has to consider the proposal.

Coty's CEO, Camillo Pane, recently resigned from the New York company, which is facing supply chain and revenue issues. Pierre Laubies, who last ran JDE, a beverage company, took over in November. He also has a seat on the board.

In afternoon trading, Coty shares rallied 14 percent to $11.02.

JAB, based in Luxembourg, has investments in Dr. Pepper, Krispy Kreme Doughnuts, the Pret a Manger and Panera Bread chains and Reckitt Benckiser, a consumer goods maker.