S&P ups Avon, off watch

S&P said it upgraded Avon Products Inc.’s rating to B+ from B following Natura Cosmetico SA’s acquisition of the company.

The agency also raised the rating on Avon’s secured debt to BB from BB-. The recovery rating remains 1 (rounded estimate 95%). In addition, S&P upgraded the issue-level rating on Avon’s unsecured debt to B+ from B and revised the recovery rating to 3 from 4 (rounded estimate 50%) following the company’s termination of the revolving credit facility in connection to the acquisition. S&P removed all of Avon’s ratings from CreditWatch.

“The upgrade follows the completion of the acquisition of Avon by Natura and our view of Avon’s strategic importance to Natura & Co. Avon is now fully owned by Natura & Co. The acquisition of Avon complements Natura’s portfolio of brands, strengthens Natura’s position in Brazil and other core markets and allows the group to accelerate growth internationally,” said S&P in a press release.

The outlook is stable.

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