In an 8-K filing, Avon (NYSE:AVP) discloses it has “approved actions primarily consisting of global headcount reductions relating to an information technology infrastructure outsourcing initiative.” $30M in pre-tax charges are expected, with $20M expected to be recorded in the January quarter.
The “initiative” in question: Avon has hired HP Enterprise (NYSE:HPE) to “transform key elements of Avon’s global IT infrastructure.” As part of the dea, HPE will “identify cost efficiencies and provide tools and processes to operate more consistently.”
Ahead of the news, Avon fell 12.5% on an ugly day for equities. The company’s strong Chinese exposure likely contributed to its selloff.
Curated from: http://seekingalpha.com/news/3020136-avon-cutting-jobs-outsourcing-parts-of-it-infrastructure-to-hp-enterprise