S&P puts Avon on positive watch

S&P said it placed all of the ratings on Avon Products, Inc., including its B issuer credit rating, on CreditWatch with positive implications.

Avon announced that it has been in preliminary discussions with Natura Cosmeticos SA regarding a potential transaction, the agency explained.

Although no further details have been disclosed, it is the understanding that Natura could be seeking to acquire Avon's operations, S&P said.

Natura's ratings were placed on CreditWatch with negative implications.

The ratings outcome will likely depend on the post-transaction issuer credit rating on Natura and the level of support that it might provide to Avon, the agency said.

S&P said it will resolve the CreditWatch placement when the transaction closes and the combined companies strategies, capital structure and financial policies are assessed.

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