As part of its transition to new leadership, Avon Products (AVP) said Friday that executive chairman and board of directors member Andrea Jung is stepping-down from her positions at the end of 2012. She will remain a part of the door-to-door cosmetics seller’s team in an advisory capacity.
She was replaced as Avon chief executive by Johnson & Johnson executive Sherilyn S. McCoy in April. Fred Hassan, who joined Avon in 1999 and currently serves as lead independent director, will be become non-executive chairman of the board.
Hassan is presently a partner and managing director at private equity firm Warburg Pincus and previously was the Chief Executive Officer at Schering-Plough Corp. Merck & Co. (MRK) acquired Schering-Plough in 2009 in a $41.1 billion merger.
Avon is looking to be a turn-around story as it has been under tremendous pressure related to three straight years of declining profit, a rejected takeover attempt from Coty, Inc. and a federal probe for allegations of bribing foreign officials. With a background in marketing, not operations, Jung was perhaps not equipped with the tools to deal with the plethora of challenges. In August the company released earnings showing a 70 percent plummet in sales and tightening margins, citing lower demand globally for its makeup and skin-care products.
The market is apparently viewing the move as a step in the right direction for the company. Shares have been treading water around $16 for the four months, but have surged ahead to above $17 per share in morning trading.