Avon’s stock could return to equity markets if this comes to pass

Natura and Avon would have “unique business plans, independent governance and management teams better equipped to pursue more tailored strategies to drive long-term shareholder value,” the Brazilian company said. Natura NTCO, -2.23% bought Avon in a deal that closed in 2020.

The Natura brand would have a “clear focus” on sustainability, and would operate the Natura brand worldwide as well as the right to operate the Avon brand in Latin America.

Avon would be the owner of the Avon brand and would be a “geographically diversified business” focusing on “creating a better world for women,” the company said.

The two businesses “have distinct geographical footprints and serve different beauty consultants and consumers,” Natura said.

The assessment is consistent with Natura & Co.’s strategy of “simplifying its corporate structure while providing increased autonomy to its business units,” and comes as the beauty company recently sold Aesop to France’s L’Oreal SA, and The Body Shop to a private-equity firm.

Last week, Natura said its board had approved a plan to end the company’s secondary listing of American depositary receipts on the New York Stock Exchange, keeping its primary listing on the Sao Paulo stock exchange, where the “vast majority” of trading activity is concentrated.

After Monday’s possible separation news, the Natura ADRs rose 2% in extended trading, after ending the regular trading day down 0.2%.