Brazil authorities give Natura’s Avon acquisition green light

BNatura executives say that this was the biggest obstacle to overcome of the steps necessary to secure and complete the transaction, stating that the other conditions still yet to be fulfilled include anti-trust approval in other specific areas.

The deal was first announced in May of this year, and was lauded as one that would turn Natura into the first Brazil-owned global beauty powerhouse, putting it the rankings with Unilever, P& G, and the world’s biggest cosmetics company, L’Oreal.

Creating the fourth biggest beauty company ​

Indeed, experts estimate that the combined revenues of the new business will make Natura the fourth biggest player in the world, thanks to the recent addition of other global beauty businesses, including The Body Shop and Aesop.

“​We are very pleased to have received approval without restrictions from Brazil’s competition authority,” ​said Roberto Marques, Executive Chairman of Natura &Co.

“The process is advancing according to our expectations, and ​we continue to expect a closing of the transaction by the first quarter of 2020.”​

Expanding footprint in Latin America​

To meet legal obligations, the decision was published in the Brazil Official Gazette, and next week will be the legal deadline to make the decision final.

Once the deal is finalized, Natura’s footprint will be expanded worldwide, thanks to the expanse of the Avon Products business, but it is in the Latin America market where the most benefits will be seen.

Currently Avon Products biggest market is Brazil, which coincides with Natura’s biggest interest and should enable the two businesses to forge significant synergies and cost savings.

Beyond that market, Mexico should also prove to be an important new market once the deal is secured, because it will give Natura a bigger platform in the highly competitive direct sales category in the country.