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Avon’s board to consider Coty’s $10.7bn takeover bid

A response is expected within a week.

On Sunday, the board of directors of the US beauty company Avon Products announced that it will consider the German perfume maker Coty’s $10.7bn takeover bid.

Coty, which raised its initial bid from $22.25 a share to £24.75 last week, had said it would withdraw the offer by the end of today. Avon had previously rejected all offers from Coty.

According to Coty, the merger would create a global beauty company with broader innovation, branding and execution capabilities to benefit its customers, representatives and associates around the world, while providing compelling value to Avon’s shareholders. 

On 10 May, Moody's downgraded Avon's long-term ratings from A3 to Baa1. The company, whose results last quarter came in significantly below expectations, has been troubled by operational and legal complications, including an investigation by US regulators involving its communications with financial analysts. 

In a Reuters report, a Coty spokesperson said on Sunday: “Coty received an email from Avon that tracks the press release they issued this afternoon. It does not provide additional information. We have reached out to Avon to clarify why they are seeking additional time to respond to our request from last Wednesday to begin discussions and due diligence.”