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Fitch affirms Avon rating

Tue, 07/13/2010 - 4:13pm
The Associated Press

Fitch Ratings on Tuesday kept the "A-" issuer default rating it holds for Avon Products Inc. in the wake of the company's agreement to pay at least $650 million for jewelry seller Silpada Designs.

Avon, which is a direct seller of beauty products, said Monday that it would buy Silpada, which is a direct seller of sterling silver jewelry, in a move to beef up Avon's jewelry business.

The purchase of Silpada, which has $230 million in annual revenue, is expected to close in the third quarter.

The ratings service also affirmed Avon's "A-" bank credit facilities and senior unsecured notes ratings, as well as its "F2" short-term issuer default rating and commercial paper rating.

Fitch said its rating outlook for Avon is still "Negative."

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