You can seemingly kiss Avon Products, Inc. goodbye, as the legendary beauty brand filed for Chapter 11 bankruptcy on Monday. The filing comes as the brand seeks to address its debt and legal liabilities caused by lawsuits that claim that its talc-based products were riddled with cancer-causing substances, both Fox News and New Beauty have reported.
Avon products haven’t been sold in the U.S. since its holding company got rid of the North America business in 2016.
Avon’s international business is not part of the filing. “It is business as usual in Avon’s international markets,” the case states. “The Avon Company, which is the Avon brand in the U.
S., is also not part of the proceedings.” If you can recall, Avon has long been known for selling cosmetics, skincare, perfume and personal care products, mainly via the company’s door-to-door saleswomen.
“Today’s action and the proposed sale of Avon’s non-U.S. operations will maximize the value of our assets and enable us to address our obligations in an orderly manner,” John Dubel, chair of Avon Products, said in a release.
“We remain focused on advancing our business strategy internationally, including modernizing our direct selling model and reigniting the brand to accelerate growth,” Kristof Neirynck, CEO of Avon, said. “Since becoming CEO earlier this year, I am increasingly energized by our strengths and opportunities, supported by our valued associates and nearly two million representatives around the world.” According to Bloomberg Law, the firm has already incurred $225 million of costs defending personal injury lawsuits and settlement payments and doesn’t have “sufficient liquidity to litigate and/or settle” the cases, its Chief Restructuring Officer Philip Gund said in court filings.
The company expects the number of lawsuits “will only continue to increase absent a permanent solution.” Avon’s operations outside of the U.S.
will continue to operate as normal while the process continues. The filing also shared that Natura & Co, a Brazil-based firm that acquired Avon in 2020, has “entered into an agreement to purchase Avon’s non-U.S.
operations, subject to a Court-supervised auction process, as reported in the filing. API has secured a commitment from Natura & Co for debtor-in-possession financing to provide sufficient liquidity to fund API’s obligations during the sale process.” Stories by EmilyAnn Jackman Family of murdered ‘General Hospital’ actor pleads for more help to find his killers Barack Obama’s summer reading list of his 14 must-buy books is out Simone Biles’ birth mother speaks out, begs for forgiveness.
