In a statement, Avon said," Avon's Board of Directors, in conjunction with management and the company's financial and legal advisors, will consider Coty's letter dated May 9. Avon's Board expects to respond within a week."
On May 9, Coty had raised its offer to acquire Avon for USD 24.75 a share from USD 23.25 apiece. The deal size is understood to be about USD 10.7 billion.
If the deal goes through, it would give Coty a greater access to emerging markets.
Avon, with annual revenues of USD 11 billion, has been facing operational and financial challenges.
Its profits declined 82 per cent to USD 26.5 million in January-March quarter of 2012 compared to USD 143.5 million in the same period year ago.
Besides, the revenue from Asia Pacific fell to 15.4 per cent in first quarter of 2012 from 23 per cent in same period last year.
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Coty had stated that its equity financing sources will include principal shareholder Joh A Benckiser, BDT Capital Partners and certain of its limited partners, and Berkshire Hathaway Inc, while debt financing will be provided by JP Morgan Securities.
It also claimed to withdraw the proposal if Avon did not respond by May 14.
"If you choose not to engage with us, we will withdraw our proposal. Our intention is to submit this letter and our revised proposal to Avon's Board on a confidential basis. However, if you do not enter into discussions with us by May 14th, we will have to inform the public markets of the circumstances of our withdrawal," Coty had said.
According to media reports, last month Avon rejected Coty's original bid of about USD 10 billion, saying the offer undervalued the company.
Avon's product line includes beauty products, as well as fashion and home products, and features brand such as Avon Color, Avon Naturals, and mark.