Davis Polk & Wardwell LLP in New York and São Paulo and Brazil’s Pinheiro Neto Advogados have helped Brazilian cosmetics group Natura raise 5.6 billion reais (US$1 billion) in an equity offering.

The underwriters relied on White & Case LLP in New York and São Paulo and Brazil’s Machado Meyer Advogados. The transaction closed on 14 October.

Natura first listed 25,069,000 common shares that were converted to some 12.5 million American Depositary Shares (ADS) and sold to international investors on the New York stock exchange. Each ADS unit represented two common shares in Natura. 

The company issued a further 96,331,000 common shares on São Paulo’s B3 stock exchange. The equity was priced at 46.25 (US$8) reais per share or US$16.45 per ADS unit. That was slightly below Natura’s initial target of 51.13 reais (US$8.86) per share.

Natura will use the proceeds of the transaction to finalise its integration with British cosmetics group Avon, which it acquired for US$2 billion last year. It will also use the funds to pay off existing debt.

Natura’s tie-up with Avon made it the world’s fourth largest cosmetics group and the largest global door-to-door make-up retailer. Brazil’s antitrust watchdog, CADE, approved the merger last November.

Natura owns luxury Australian cosmetic company Aesop, as well as well-known British retailer The Body Shop. In the first quarter of 2020, the Brazilian parent group recorded an average revenue increase of 14.9% across its global brands. In June this year, the company made another shares offering, worth US$366 million.

Counsel to Natura & Co

Davis Polk & Wardwell LLP

Partner Manuel Garciadiaz and associates Lourenço Lopes-Sabino and Hugo Casella in São Paulo, and partner Mario Verdolini and associates Joseph Gerstel and Brantley Hawkins in New York

Pinheiro Neto Advogados

Partners Henrique Lang and Guilherme Sampaio Monteiro, and associates Carvalho Gomes and Marcello Mammocci Pompilio in São Paulo

Counsel to Bank of America, Morgan Stanley, Banco Bradesco, Citigroup and Itaú

White & Case LLP

Partners Don Baker and John Guzman in São Paulo, and partners Rupa Briggs and Sang Ji, counsel Isaac Tendler, and associates Alok Choksi, Yana Shneyderman, Samuel Chan, Nashel Jung and Grayson Weeks in New York

Machado Meyer Advogados

Partner Eliana Ambrósio Chimenti and associates Alessandra de Souza Pinto and Heithor Murakami Dall Amico in São Paulo.

(Latin Lawyer 02/11/2020)