AVP Avon Products Inc

By Colin Kellaher

LG Household & Health Care Ltd. (051900.SE) on Thursday said it agreed to buy New Avon LLC, the North American cosmetics business cleaved from Avon Products Inc. (AVP) in 2016, for $125 million in cash.

LG Household, a Seoul-based maker of consumer goods and beauty products, is acquiring New Avon from private-equity firm Cerberus Capital Management L.P. and former parent Avon Products, which still held a minority stake.

New Avon, also known as Avon North America, split from the larger Avon Products as part of a deal under which Cerberus bought a 17% stake in the parent company and acquired 80% of New Avon. The deal separated the unprofitable North America division from Avon Products' international business.

The transaction expands the North American reach of LG Household, which currently distributes a number of its brands in the U.S., including belif and The History of Whoo. The Korean company said it expects to complete the acquisition on Sept. 30.

Avon Products, which has an existing relationship with LG Household, said the Avon North America deal has no impact on its current operations or strategy.

In an unrelated transaction, Avon Products earlier this year sold its manufacturing operation in Guangzhou, China, to LG Household, and the companies entered a manufacturing and supply agreement.

Write to Colin Kellaher at colin.kellaher@wsj.com

(END) Dow Jones Newswires

April 25, 2019 06:36 ET (10:36 GMT)

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