Avon Voluntarily Commences Chapter 11 Bankruptcy Proceedings

Avon Products Inc. (API), a U.S.-based non-operating holding company for the Avon beauty brand, has commenced voluntary Chapter 11 proceedings in the U.S. Bankruptcy Court for the District of Delaware to address its debts and legacy talc liabilities.

Avon’s operating businesses outside the U.S. continue to advance their strategic plans and are not part of the Chapter 11 process, and Avon’s business in international markets is continuing as normal.

Avon Products Inc. has not sold products in the U.S. since the divestiture of its North American business in 2016, but remains the holding company for the brand’s non-U.S. operating entities. Natura&Co, which acquired Avon in 2020, has agreed to acquire the equity interest in Avon’s non-U.S. business in a $125 million credit bid, subject to a court-supervised auction process. Natura&Co has committed up to $43 million in debtor-in-possession financing, which, subject to court approval, will provide sufficient liquidity to fund Avon Products Inc.’s obligations during the sale process.

Kristof Neirynck, Avon CEO, said: "We remain focused on advancing our international business strategy, including modernizing our direct-to-consumer model and reinvigorating our brands to accelerate growth. Since taking on the role of CEO earlier this year, I have become increasingly motivated by our strengths and opportunities, enabled by the support of our valued colleagues and nearly 2 million representatives around the world."

John Dubel, Chairman of Avon Products Inc., said: "Today's actions and the proposed sale of Avon's non-U.S. operations will maximize the value of our assets and enable us to execute our obligations in an orderly manner."