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Avon Products, Inc. (NYSE:AVP) Investor Files Lawsuit Against Directors Over Takeover Offer By Coty

  • If you are a current investor in Avon Products, Inc. (NYSE:AVP) shares and purchased your Avon Products, Inc. (NYSE:AVP) shares prior to April 2, 2012, you may have certain options. Please contact the Shareholders Foundation, Inc.

  • To have your information reviewed for options and to receive notifications about this case, please send an email to mail@shareholdersfoundation.com, or call us at (858) 779-1554.

Lawsuit Overview

Company
Avon Products, Inc.
Security
NYSE: AVP

Case Name
Avon Products Deal Case 04/05/2012
Type of Lawsuit
Mergers and Acquisition
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Summary

May 22, 2012 (Update) -- On May 10, 2012 it was reported that Coty Inc has raised its bid for Avon Products Inc to $24.75 per share, up $1.50, but said it would withdraw its offer if Avon Products, Inc. did not enter into discussions by May 14. Then on May 14, 2012, Coty Inc. announced that it has sent a letter to the Avon Products, Inc., Board of Directors and withdrew its takeover bid. NYSE:AVP shares fell on Tuesday, May 15, 2012 to $18.21 per share and declined to as low as $16.90 per share on May 18, 2012.

April 9, 2012 (Shareholders Foundation) -- At least three investors in NYSE:AVP shares filed lawsuits against the members of the board of directors of Avon Products, Inc. over their alleged failure to properly consider the takeover offer by Coty.

On Monday, April 2, 2012, Coty Inc. announced that it has submitted a non-binding proposal to acquire Avon Products, Inc. (NYSE: AVP) for $23.25 per share in cash. Shortly after the announcement was made public the board of directors of Avon Products, Inc. rejected the offer.

According to the complaint the plaintiff alleges the Director Defendants' actions are unreasonable, motivated purely by their own selfish interest in preserving their position on the Board. The plaintiffs say that despite Avon Products’ “prolonged underperformance, disastrous recent financial results, and substantial uncertainty about its future prospects and direction”, defendants rather than considering the premium being offered to shareholders or negotiating a higher bid, within an hour of receiving the bid flatly rejected the proposed transaction. The plaintiff says that the hasty rejection of the Proposed Transaction is not based on a good faith belief that negations with Coty are not in the best interests of the Company or its shareholders. The plaintiff claims that under these circumstances, Defendants have breached their fiduciary duties and deprived Avon's shareholders of substantial value in the form of an offer at a premium of almost 24% of the Company's trading average for the past 20 days, and an approximately 20% premium to its March 30, 2012 closing price. NYSE:AVP shares jumped after the takeover announcement on April 2, 2012 to $22.97 and closed on April 5, 2012 at $23.42 per share.