Coty withdraws bid for Avon
NEW YORK — Just days after Coty upped its proposal for Avon, the former has decided to withdraw its offer, citing Avon’s “delay and unwillingness to engage in discussions.”
“We believe that we provided the board with ample time to respond, particularly since it has already had months to consider our initial request. Yesterday, we received a two-sentence email indicating, without explanation, that Avon’s board would need another week to consider our request. Since receiving [the] email, we have reached out to Avon’s board, management and advisers to understand why additional time is needed, but we have received no explanation,” Coty stated in a May 14 letter to Avon.
Coty told Avon in a letter dated May 9 that it was revising its proposal to $24.75 per share from $23.25. “We are revising our proposal to $24.75 subject to due diligence and the other conditions. This price represents a premium of [more than] 36% to the original undisturbed closing price on March 6, 2012, before our initial proposal of $22.25, and also represents [more than] $1 billion of incremental value to your shareholders, despite a materially weakened outlook for your business,” Coty wrote in the May 9 letter.
Coty had requested that Avon respond to the revised proposal by the end of business on May 14. Avon responded to the revised proposal, indicating that it was considering the sweetened bid and its board expected to respond within a week.
In the latest letter dated May 14, Coty stated that since it submitted its revised proposal, and despite repeated requests over the last 24 hours, no one from Avon’s board or management has been willing to speak with Coty.
“Two months is enough. Consequently, as our deadline to begin discussions expired today [May 14], our proposal is withdrawn. It is time for Coty Inc. to move on and pursue other opportunities,” Coty stated in the letter.
In light of the news, Morgan Stanley analyst Dara Mohsenian stated in a research note that, “Clearly, we expect shares will be weak on this news. While we do believe there is still some strategic potential at Avon, as another bid could emerge or Coty could conceivably come back to the table, the stock is likely to trade more on fundamentals now.”
Avon considering Coty’s sweetened offer
NEW YORK — Avon Products on Sunday advised Coty that its board of directors, in conjunction with management and the company’s financial and legal advisers, is considering Coty’s sweetened bid.
Avon’s board expects to respond within a week.
In a letter dated May 9, Coty told Avon that, “in our final effort to move forward with discussions,” it was revising its proposal from to $24.75 per share from $23.25. “We are revising our proposal to $24.75 subject to due diligence and the other conditions. This price represents a premium of over 36% to the original undisturbed closing price on March 6, 2012, before our initial proposal of $22.25 and also represents over $1 billion of incremental value to your shareholders, despite a materially weakened outlook for your business,” Coty wrote in the letter.
Coty requested that Avon respond to the revised proposal by the end of business on May 14.
“If after due diligence our final proposal were to be unacceptable to you, we will simply indicate so in a mutually agreeable statement and part company as friends,” Coty stated in the letter.
Last month, Coty reaffirmed its interest in Avon after the company rejected the unsolicited bid valued at $10 billion.
Aquaphor sponsors New York City Triathlon
WILTON, Conn. — Beiersdorf’s Aquaphor brand is the new title sponsor of the New York City Triathlon.
This partnership, with race organizer Korff Enterprises, is a three-year agreement that includes naming rights, as well as a variety of marketing and promotional components for the Olympic-distance race.
More than 3,000 athletes from 44 states and 10 countries will compete in the 2012 Aquaphor New York City Triathlon on July 8, 2012. The race includes a 1.5-kilometer swim in the Hudson River, 40-kilometer bike on the Henry Hudson Parkway and 10-kilometer run in Central Park.
As title sponsor, Aquaphor will help participants prepare and/or heal their skin during the event. The company will sponsor some of the race’s most popular elements — including the Diaper Derby, athlete expo and finishers’ area — and provide its Aquaphor Healing Ointment and Lip Repair products to participants and fans.
In addition, the company has announced that world champion athlete, author, host of ABC’s "Everyday Health" and Aquaphor Mombassador Laila Ali will compete in this year’s Aquaphor New York City Triathlon. In the weeks leading up to the event, Ali will train for the swim, bike and run under the guidance of the Carmichael Training Systems and share training and skin care tips with athletes and moms across the country. Fans also can follow Laila’s training on her Twitter and Facebook pages.