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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Avon Products Inc | NYSE:AVP | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 5.60 | 0 | 01:00:00 |
NEW YORK, April 16, 2012 /PRNewswire/ -- Coty Inc., a leading global beauty company, today announced that it has sent a letter to Avon Products, Inc. (NYSE: AVP).
Coty also announced that it has accepted an invitation from AllianceBernstein to discuss its proposal and answer questions from the investment community today at 10:00 AM ET. Coty is providing a live webcast of that conversation at http://coty.pressnews.net/. A replay of the webcast will be available beginning later today at http://coty.pressnews.net/.
A copy of the letter sent to Avon follows below:
April 16, 2012
Andrea Jung, Chairman and Chief Executive Officer
Avon Products, Inc.
1345 Avenue of the Americas
New York, NY 10105
Dear Andrea:
Since we first made public our proposal to acquire Avon for $23.25 per share in cash, we have carefully watched the public reaction to the news and your recent announcement of the hiring of a CEO. We continue to believe in the benefits of our proposed acquisition, and remain interested in meeting with you to discuss our proposal, which we will pursue only on a friendly, consensual basis.
We are confident in our ability to finance the acquisition. BDT Capital Partners, LLC has arranged for equity commitments which, together with the equity committed to us by the Joh. A Benckiser companies, total more than $5 billion. Coty has also received a highly confident letter from J.P. Morgan Securities LLC for the debt financing. The equity commitments and debt highly confident letter are subject to conditions, including completion of satisfactory due diligence and execution of definitive financing and merger documentation. We intend to structure our financing to achieve an investment grade credit rating for our debt.
Our current proposal of $23.25 reflects what we know about Avon based on public information as well as our concerns with what we do not know. We do not know the extent of the legal issues such as the Foreign Corrupt Practices Act investigation and related investigations and litigation or the extent of the operational challenges, and we cannot calculate the level of synergies from public SG&A information or the amount we would need to reinvest to fix the operational issues. These are all significant items materially impacting the value of Avon.
At this stage, without being invited to complete due diligence, we have no way of knowing the best price we can ultimately pay to Avon shareholders.
As we have also said before, we are prepared to sign a confidentiality agreement to cover our receipt of confidential information.
We believe strongly that the only reasonable way to reach a conclusion on overall value for your shareholders is to do so in private negotiations, after you have given us access to due diligence. We are proposing that we devote no more than a couple of weeks – at your invitation – in confidential discussions to see if we have a basis for proceeding with a transaction. If we do not, each company can move on, taking its separate course.
I sincerely hope you will agree that your shareholders' interests will be best served by meeting with us to discuss our proposal.
With best regards, | |||||
Bart Becht | |||||
cc: |
Fred Hassan, Board of Directors of Avon Products, Inc. | ||||
Byron D. Trott, BDT & Company, LLC | |||||
James M. Grant, James C. Woolery, J.P. Morgan Securities LLC | |||||
Mary Anne Citrino, Blackstone Advisory Partners L.P. | |||||
Paul Schnell, Skadden, Arps, Slate, Meagher & Flom LLP |
This letter and our proposal constitute a preliminary, non-binding indication of interest to acquire the outstanding shares of Avon, and our proposal is being submitted based on the understanding that it is not an offer that is capable of being accepted and that there will be no binding agreement between us or any commitment or obligation on either party with respect to the proposal or a possible transaction unless and until a definitive agreement is executed by Avon and Coty. We reserve the right to discontinue discussions regarding, and withdraw, our proposal at any time. Our proposal is subject to customary conditions, including, among other things, our satisfaction with the results of due diligence in our sole discretion, the negotiation of a mutually satisfactory definitive agreement, financing and the approval of the negotiated terms of a transaction by our Board of Directors.
About Coty Inc.
Coty was created in Paris in 1904 by Francois Coty, who is credited with founding the modern fragrance industry.
Today Coty Inc. is a recognized leader in global beauty with annual net sales of $4.5 billion. Driven by an entrepreneurial spirit, passion, innovation and creativity, Coty Inc. has developed an unrivaled portfolio of notable brands and delivers its innovative products to consumers in 135 markets worldwide.
The Coty Prestige brand portfolio is distributed in prestige and ultra-prestige stores and includes Balenciaga, Bottega Veneta, Calvin Klein, Cerruti, Chloe, Chopard, Davidoff, Jennifer Lopez, Jil Sander, JOOP!, Karl Lagerfeld, Kenneth Cole, Gwen Stefani, Lancaster, Marc Jacobs, Nikos, philosophy, Roberto Cavalli, Sarah Jessica Parker, Truth or Dare by Madonna, Vera Wang, Vivienne Westwood and Wolfgang Joop.
The Coty Beauty brand portfolio is more widely distributed and includes adidas, ASTOR, Beyonce Knowles, Celine Dion, David and Victoria Beckham, Elite Models, Esprit, Exclamation, Faith Hill, GUESS?, Halle Berry, Heidi Klum, Jovan, Kate Moss, Kylie Minogue, Lady Gaga, Manhattan, Manhattan Clearface, Miss Sporty, Nautica, N.Y.C. New York Color, Nicole by OPI, OPI, Pierre Cardin(1), Playboy, Rimmel, Sally Hansen, Stetson, Tim McGraw, TJoy and Tonino Lamborghini.
Coty and Puig S.L. have a strategic partnership for the distribution of the perfume lines of Antonio Banderas, Carolina Herrera, Nina Ricci, Paco Rabanne, Prada, Shakira and Valentino in the United States and Canada.
(1) Not available in North America
Additional Information
This communication does not constitute an offer to buy or solicitation of an offer to sell any securities. No tender offer for the shares of Avon Products, Inc. has been commenced at this time and Coty Inc. has not indicated any intent to do so.
SOURCE Coty Inc.
Copyright 2012 PR Newswire
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