Natura &Co to explore possible separation of Natura &Co Latam and Avon into two independent listed companies

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Feb 05, 2024, 16:47 ET

The potential move would support the group's strategy of simplifying operations, strengthening brand autonomy and unlocking shareholder value

SÃO PAULO, Feb. 5, 2024 /PRNewswire/ -- Natura &Co (NYSE – NTCO; B3 – NTCO3) announces that its Board of Directors has authorized its management to assess a possible separation of Natura &Co Latam and Avon to unlock further shareholder value.

A separation would result in two independent, publicly traded beauty companies (Natura and Avon), with unique business plans, independent governance, and management teams, better equipped to pursue more tailored strategies to drive long-term shareholder value:

Natura: a leading beauty company with historically clear focus on sustainability, owning and operating the Natura brand worldwide and with the right to operate the Avon brand in Latin America and;
Avon: the owner of the Avon brand, operating a geographically diversified business with a strong innovation heritage in beauty and personal care and driven by an intrinsic purpose of creating a better world for women.

This assessment is consistent with Natura &Co's ongoing strategy of simplifying its corporate structure while providing increased autonomy to its business units and follows the recent divestments of Aesop and The Body Shop.

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. The two standalone entities would each have independent governance and management teams. This potential separation would also afford shareholders greater visibility into the financial performance, structure, growth prospects, and investment theses of the respective companies.

Natura would continue to operate with both brands in the region, so the potential separation would not impact the integration of the brands in Latin America. In turn, Avon would indirectly benefit from the sales in Latin America through a commercial arrangement with Natura, while continuing its operations in other markets outside Latin America.

There can be no assurance that any separation will ultimately be recommended by the Board of Directors. Completion of a separation would be subject to various conditions, including final approval from the Board of Directors and consent from the majority of shareholders, among others.

While the strategic assessment is being conducted by Natura &Co´s management, the company continues to implement Avon´s turnaround strategy and integrate the businesses of the Natura and Avon brands in Latin America.

About Natura &Co:

Natura &Co is a global purpose-driven group uniting Natura and Avon, engaging customers through 7 million dedicated Consultants and Representatives, 900 stores and franchises, and 22,000 employees.

We believe in promoting real positive economic, social, and environmental impact. We believe that the world does not need another big company. The world needs symbols of change capable of blazing new trails and inspiring others to follow. We believe in the power of cooperation, co-creation, and collaboration for a better way of living and doing business.

We are Natura &Co.

This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities. Any offers, solicitations or offers to buy, or any sales of securities will be made in accordance with the registration requirements of the Securities Act of 1933, as amended, or an exemption therefrom. This communication may contain forward-looking statements which reflect Natura &Co's current view on future events and financial and operational development. Words such as "intend", "expect", "anticipate", "may", "believe", "plan", "estimate" and other expressions which imply indications or predictions of future development or trends, and which are not based on historical facts, are intended to identify forward-looking statements. Forward-looking statements inherently involve both known and unknown risks and uncertainties as they depend on future events and circumstances. Forward-looking statements do not guarantee future results or development and the actual outcome could differ materially from the forward-looking statements. Any forward-looking statements contained in this communication speak only as at the date hereof, and Natura &Co does not assume or undertake any obligation or responsibility to update any forward-looking statement to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

SOURCE Natura &Co