Avon is an iconic American company that has been around for nearly 130 years. But Avon is struggling. And there’s not enough makeup in the world to make it more attractive.
Things have gotten so bleak for Avon (AVP) that investors actually pushed the stock higher Thursday following a report of a takeover offer … that turned out to be fake.
An entity calling itself PTG Capital filed a letter with the SEC claiming that it wanted to buy Avon for $18.75 a share — nearly triple what the stock was trading at on Wednesday.
Shares surged as much as 20% shortly after news of the filing started to spread. But traders and financial reporters quickly poked holes in the “offer.”
The filing had typos in it. PTG was referred to as TPG on two occasions. (TPG is an
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Avon In Possible Deal Talks For A Takeover; Reports Bloomberg
by Tina Williams • • 0 Comments
Bloomberg Reports : Avon Products Inc. (AVP), the world’s largest seller of door-to-door cosmetics, jumped the most in almost two years after Dealreporter said the company has held talks with private equity firm TPG Capital about a possible transaction.
The report sent the shares up 15 percent to $8.66 in New York, the biggest one-day increase since February 2013. The stock declined 45 percent last year.
Avon is seen as a candidate for a leveraged buyout because it has strong cash flow, Dealreporter said, even though sales have been slumping in recent years. The takeover speculation follows the end of a six-year U.S. investigation into whether Avon’s Chinese subsidiary bribed local officials. The company pleaded guilty last month and agreed to adopt internal controls and pay $135 million in fines.
It isn’t clear if the TPG talks have advanced or whether Avon has hired advisers to consider a deal, said Dealreporter, which cited three unidentified people within the industry.
Owen Blicksilver, a spokesman for TPG, declined to comment to Bloomberg News, as did Lindsay Fox, a spokeswoman for New York-based Avon.
Avon joins Elizabeth Arden Inc., another beauty company, in spurring takeover talk. Elizabeth Arden, maker of Elizabeth Taylor and Britney Spears brand perfumes, hired Goldman Sachs Group Inc. last