Procter & Gamble plans to sell 43 beauty and fragrance brands to Coty in a deal valuing the assets at about $12.5 billion, the companies announced Thursday.

The transaction includes well-known brands such as hair dyes Nice & Easy and Miss Clairol, and Hugo Boss and Gucci fragrances.

The consumer products giant said the spin-off was part of its strategy to streamline its secondary brands in order to better promote best-sellers like Gillette razors and Head & Shoulders shampoo.

"This represents a significant step forward in the work to focus our portfolio on 10 categories and 65 brands that best leverage P&G's core competencies," said chief executive AG Lafley.

Complete details of the deal are not settled, but P&G hopes to structure it as a "Reverse Morris Trust" in which, to minimize taxes involved in the sale, Coty would take over the brands and P&G shareholders would have the option to exchange some of their P&G shares for Coty shares.

P&G said the deal will result in a one-time gain of $5-$7 billion.

The transaction will be a game-changer for Coty, which in 2014 had revenues of $4.6 billion. The combined company will have revenues of more than $10 billion, it said.

"With the Beauty talent from both sides and the fantastic portfolio of world-class brands, we have the opportunity to create a highly focused, pure-play leader and challenger in Beauty which can deliver exciting opportunities and benefits for employees, licensors, customers and suppliers," said Coty chief executive Bart Becht.

At mid-morning, Coty shares fell 5.6 percent to $29.77, while Dow member P&G rose 0.1 percent to $81.04.