LG Household & Health Care has signed an agreement to acquire Avon’s U.S., Canada and Puerto Rico businesses.
LG Household & Health Care will step up its efforts to expand its presence in the North American market. The company announced on April 25 that it has signed a deal to take over a 100 percent stake in U.S. cosmetics and personal care company New Avon for US$125 million.
Avon is the world's largest cosmetics and personal care direct sales company with 130 years of history. In 2016, the company separated its North American business, which included the U.S. market, from its operations and sold it to Cerberus, a private equity fund. Since then, New Avon has managed Avon’s North American business, while other regions have been managed by Avon Products Inc.
New Avon has taken over Avon's global business headquarters with sales of 13 trillion won and solid infrastructure in IT, procurement, logistics, sales, and general management. New Avon currently operates in the United States, Canada, and Puerto Rico, and posted about 700 billion won in sales in 2018.
The United States is the largest cosmetics and health functional food market in the world, with each segment estimated at 50 trillion won. LG Household & Health Care plans to use the United States as a base for its expansion to other major foreign markets including Canada, South America and Europe.
In the meantime, LG Household & Health Care will advance its brands into the U.S. market by making good use of the North American infrastructure secured through the takeover.