Natura & Co mulls separation of Avon business

Natura & Co is exploring a separation of its Avon businesses outside of Latin America.

This would result in two independent, publicly traded beauty companies, Natura and Avon, with separate governance, management teams and business plans. 

Natura & Co would still operate Avon’s business in Latin America.

It does not own Avon US.

The brand owner claimed the move would allow it to implement more tailored business strategies that provide better shareholder value.

“The aim of this study is to unlock the full potential of both companies, which have distinct geographical footprints and serve different beauty consultants and consumers,” Natura & Co said in a statement.

“This potential separation would also afford shareholders greater visibility into the financial performance, structure, growth prospects, and investment theses of the respective companies.”

Natura & Co stressed that there is “no assurance” that the separation of its businesses will be approved, however.

The move would require a final agreement from its board of directors, as well as consent from the majority of its shareholders.

Natura & Co has been working to simplify its corporate structure over the past year.

This saw the business offload The Body Shop to private equity investor Aurelius Group in November last year.

The investment firm acquired the embattled British body care brand for £207m, just one fifth of the price the Brazilian cosmetics giant paid for it in 2017.

Prior to this, L'Oréal acquired Aesop for US$2.52bn in August 2023.

This ended the Australian luxury cosmetics brand’s decade-long ownership under Natura & Co.

Natura & Co also recently ended its secondary listing of American Depositary Shares (ADSs) on the New York Stock Exchange (NYSE). 

The declining volume of trades in its ADSs on the NYSE led to the decision.

Natura & Co will keep its primary listing of ordinary shares on the B3 stock exchange in São Paulo as the vast majority of its trading activity is concentrated there.