Natura will raise revenue with investment in Avon brand and digitization, says president

"As far as digital transformation is concerned, our approach is similar to what Avon has been following, and we also share the same optimism about the brand," said Natura CEO João Paulo Ferreira, in a teleconference with analysts. Natura's chairman, Roberto Marques, said it will be necessary to spend about 125 million dollars over the next 36 months to save 150 to 250 million of dollars a year, mainly in Brazil and the rest of Latin America. " For now, the synergies we anticipate are largely operational in the supply chain, but we also see opportunities for revenue synergies, although it is too early to provide such guidance, "Marques said in a teleconference with Journalists. Ferreira noted that nearly 500,000 consultants already sell the Natura and Avon brands, and this is expected to increase after the merger. "But our idea is to keep separate commercial structures for Avon and Natura, so no big impact is expected in terms of jobs," he said. Financial Vice President José Filippo said that Natura expects Avon securities holders to agree to the merger, but has already secured credit to pay them if they ask for early repayment. Bonus clauses allow bonus holders to be reimbursed in advance if the Avon controller changes. Filippo refused to give guidance on the financial leverage of the combined company. Avon's stock has risen 6% to its highest level in two years. Natura's shares fell 8% after reaching the historic maxim on Wednesday. BTG Pactual analysts said the agreement should add complexity to Natura's business model, as the company deals with the Body Shop's turnaround and more soft trends in the Brazilian market. But they added that similarities to Avon's business, which also has high direct sales, should facilitate integration.