Coty Inc., one of the world’s largest fragrance companies, is close to an agreement to acquire nail polish maker OPI Products Inc. for about $1 billion, according to The Wall Street Journal.

Talks were continuing Sunday, and a deal could be announced as early as Monday, reports say, but the negotiations could still fall apart.

Closely held Coty has been on the acquisition trail recently, announcing last week that it had agreed to purchase beauty company Philosophy from private-equity firm Carlyle Group. Terms of the purchase weren’t disclosed, but people familiar with the matter valued the deal at around $1 billion.

Two weeks ago, Coty, which has annual sales of $3.6 billion, said it was buying Dr. Scheller Cosmetics AG of Germany.

Though the beauty industry suffered sluggish sales during the recession, demand for nail polish has surged in recent years as women embraced it as an inexpensive way to accessorize their apparel. In 2009, U.S. sales of nail polish rose 11% from the previous year to $462.9 million, according to market-research firm Euromonitor International Inc.

OPI was founded in 1981 by George Schaeffer, who is president and chief executive. The company began as a dental-supply business. Based in North Hollywood, CA, OPI now sells nail polish and other nail-related products in salons, using fanciful names for its colors like “Overexposed in South Beach” and “I’m Not Really a Waitress.” Its products also are sold in retail stores.

OPI, which is considered a premium brand, held about 6% of the U.S. nail-polish market last year, according to Euromonitor. Coty, which owns the market-leading Sally Hansen brand and the NYC New York Color line, held 48%.