Avon Rejects Coty's $10B Acquisition Proposal

Coty Inc. announces that it has submitted a non-binding proposal to acquire Avon Products, Inc. for $23.25 per share in cash in a mutually agreeable and negotiated transaction. The proposal, valued at approximately $10 billion, represents a very substantial premium of 27 percent over the three month volume-weighted average price for Avon shares. Coty has held extensive discussions with its financing sources about obtaining the debt and equity financing necessary to complete this transaction, and is confident that such financing will be available. 

 

Following extensive but unsuccessful attempts to engage Avon in discussions regarding its proposal, Coty has decided to make its proposal public in order to inform Avon's shareholders of the significant value in a transaction. Coty said it has no intention of pursuing an acquisition on a hostile basis.

 

"Our objective is to engage in discussions with Avon and conduct due diligence so that we and Avon can together determine if there is a basis for a transaction. We believe Avon's shareholders would want their Board to explore with us the benefits to shareholders of a transaction," says Bart Becht, chairman of the Board of Directors of Coty.

 

In a letter to Avon's Board of Directors, Mr. Becht detailed the strategic and financial benefits of this combination.

 

Avon Products, Inc., however, confirmed that it received an unsolicited, non-binding indication of interest from Coty Inc. to acquire Avon for $23.25 per share.

 

Avon's Board of Directors, consistent with its fiduciary duties, carefully considered an indication of interest from Coty that was substantially the same as one made less than two weeks ago. At that time, the Board concluded, and it still believes, that Coty's indication of interest is opportunistic and not in the best interest of Avon's shareholders.

 

The Avon Board of Directors remains confident in the company's stand-alone prospects.