On Friday, Avon Products, Inc. (NYSE:AVP) announced that former Chief Executive Officer Andrea Jung has stepped down as executive chairman, effective at the end of the year. She will become a senior adviser to the company beginning Jan. 1, 2013.
Fred Hassan has been named as Jung’s successor, and will become a non-executive chairman. He has been an Avon Products, Inc. (NYSE:AVP) board member since 1999, and from 2009, he has been the lead independent director. He is a managing partner at the private equity firm Warburg Pincus, and previously, he was the chairman and CEO of Schering-Plough Corp.
Quant ESG With PanAgora Asset Management’s George Mussalli
ValueWalk's Raul Panganiban interviews George Mussalli, Chief Investment Officer and Head of Equity Research at PanAgora Asset Management. In this epispode, they discuss quant ESG as well as PanAgora’s unique approach to it. The following is a computer generated transcript and may contain some errors. Q3 2020 hedge fund letters, conferences and more Interview . Read More
With Jung’s departure, it represents the end of an interesting era for the company.
The executive joined the company in 1994, and was named as its inaugural female leader in 1999. Bringing a marketing background with her, she was the face of the brand, and oversaw a large female sales force. The company had been referred to as “the company for women.”
The pearl-wearing, designer clothes clad executive also gave back, helping to raise over $800 million for Avon’s charitable programs; they emphasize breast cancer research and the fight against violence toward women.
But over time, Jung’s lack of operational experience was a concern for the company, as well as the 2008 bribery probe.
Her exit has been a work in progress. In December, Avon said Jung would give up her chief executive officer role. This change came as the company had undergone three consecutive years of falling profits.
Jung was replaced by Johnson & Johnson (NYSE:JNJ) executive Sherilyn S. McCoy in April, but she kept her chairman title.
Earlier in the year, Avon shot down a takeover offer from the private company, Coty Inc. In May, Coty withdrew its $24.75 per share Avon bid, noting delays by the company and a lack of negotiating.
With McCoy at the helm, she said in August that the company was trying to slash costs, review its markets, and try to increase incentives for its top sales representatives, reported Bloomberg.
Regarding Jung’s exit, analysts see it as a good thing for the company’s shares.
Rommel Dionisio, a Wedbush Securities analyst, said to Bloomberg, “Given the sour taste that the last several quarters of her tenure left in some people’s mouths, I’d view this as a positive for the stock overall.”
He also recommends holding the stock.
On Friday morning, Avon’s shares have increased 96 cents, or 5.9 percent to $17.18. Year-to-date, the stock is down 1.43 percent.