Avon Sells Perfume Brands in $210-Million Cash Deal

Avon Products Inc., which has been under pressure to merge or be taken over, said today it is selling its Oscar de la Renta, Cher, Perry Ellis and Deneuve fragrance brands for $210 million.

The company said the Parfums Stern subsidiary that markets the fragrances will be sold in a cash transaction to Safrep, an affiliate of Sanofi SA of France.

Avon, the leading U.S. direct marketer of cosmetics, jewelry and personal products, said the deal is scheduled to close Jan. 3 and proceeds will be used to reduce debt.

Parfums Stern expects annual sales of more than $125 million, excluding the distribution of Giorgio Beverly Hills, another Avon fragrance unit, Avon said.

Avon said it is also considering the possible sale of Giorgio but had nothing to announce.

Earlier this month the New York-based company sold the Valentino fragrance, a Parfums Stern brand, to Valentino Group for $12.3 million.

On Tuesday, the Texas takeover concern Robert M. Bass Group announced it and partners hold 5.9% of the embattled Avon. An Avon spokesman said Robert Bass had told Avon Chairman James Preston the purchases were made “for investment purposes only.”

The Bass group did not make an offer for Avon, but at least two other shareholder groups have made overtures about a merger or takeover. Analysts said the Bass stake would increase pressure on Avon management.

Avon’s managers in the last week have publicly reaffirmed their desire to retain control after months of takeover speculation that began in May, when Amway Corp. made a $39-a-share bid for the company.

Amway held a 10.3% stake with Minneapolis investor Irwin Jacobs, and raised the bid to a “possible price” of $41 a share, or $2.2 billion, on Aug. 1.

Avon rejected both offers.