Avon Selling Last U.S. Factory

Avon Q1 2019

According to a recent Wall Street Journal report, Avon is selling its last U.S factory to a French cosmetics manufacturer. Citing people familiar with the plan, the WSJ reported Fareva Group will take over production at Avon’s factory in Morton Grove, Illinois.

Fareva, one of the world’s leading subcontractors in the industrial & household, cosmetics and pharmaceutical fields, will make private-label products for drugstore chain Walgreens Boots Alliance Inc. at the underutilized, 500,000-square-foot plant, the report said.

According to the northern Chicago suburb’s records, Avon employed 362 in Morton Grove in 2016. While financial terms were not disclosed, current Avon employees are expected to keep their jobs as part of the ownership change, the report said.

The deal comes less than three years after New Avon LLC, formerly the North American arm of Avon Products Inc., split from the larger company as part of a deal with private-equity firm Cerberus Capital Management LP. Cerberus bought a 16.6 percent stake in the parent company and acquired 80.1 percent of New Avon, which separated the unprofitable division from Avon’s international business.

Update:  Elizabeth Bergman, Director of Public Relations from Avon provided us with the following quote.

“We can confirm that we intend to establish a long term partnership with Fareva, a world class manufacturing and cosmetics development company, to begin in late 2018. We chose to partner with Fareva because they are one of the top beauty development houses in the world, and deliver innovations with great speed and efficiency.  We will have special access to their latest breakthroughs, and we will work with Fareva to build a robust innovation pipeline for our Avon Representatives and their customers. As part of this partnership, Fareva will assume operations at the manufacturing facility located in Morton Grove, IL, which manufacturers some of the cosmetics products in our Avon portfolio.”

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