Avon Products Inc. said Monday that it would reduce its head count by about 2,500 positions and move its corporate headquarters to the United Kingdom.

The actions follow the beauty-product company's recent sale of its North American operation to Cerberus Capital Management.

"With the recent completion of the sale," Avon Chief Executive Sheri McCoy said, "our commercial operations are now fully outside of the United States, allowing us to dramatically rethink our operating model."

Avon plans to transition its corporate headquarters "over time" to the U.K., where it has significant commercial operations. The company also said it plans to locate core functions in Britain.

The company will maintain its current facilities in Suffern, N.Y., and Rye, N.Y. It also will continue to be incorporated in New York and trade on the New York Stock Exchange under the symbol AVP.

Avon said the reduction in positions includes both filled and unfilled positions. The revamp also will include changes at Avon's commercial business, though specific details weren't provided.

"The actions we are taking today will bring our corporate and commercial businesses closer together," said Ms. McCoy, who has been attempting to turn the company around, in prepared remarks Monday.

Avon said it expects to post first-quarter pretax charges of $60 million related to the moves.

The company is aiming to generate pretax savings of roughly $30 million this year, tied to a head count reduction of about 1,700, and $20 million in 2016 related to the elimination of the open positions. It also expects pretax savings of approximately $65 million to $70 million beginning in 2017.

At the start of March, Avon and Cerberus announced the closing of their complex deal in which the private-equity firm agreed to inject $435 million into Avon and carve out the North American business into a separate company with another $170 million investment. Avon said the North American business isn't affected by the latest cost-cutting plans.

Write to Tess Stynes at tess.stynes@wsj.com

 

(END) Dow Jones Newswires

March 14, 2016 18:15 ET (22:15 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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