The Brazilian owner of the Body Shop has agreed to buy Avon Products in a deal that values the US cosmetics company at more than $2bn (£1.58bn), according to reports.

Natura Cosméticos was expected to announce the takeover as early as Wednesday, the Financial Times reported. After the deal, Natura would control more than three-quarters of the combined group. The remaining shares would be owned by Avon shareholders.

Avon, founded in 1886 and known for its doorstep-selling model, has its headquarters in London but is listed in New York with a market value of about $1.4bn. In January, the company announced plans to cut about 2,300 jobs – or 10% of its global workforce – as it sought to find cost savings of almost $100m.

The company has struggled to keep pace with changing consumer tastes and habits and competition from rivals that have capitalised on the growth in online beauty sales.

Both boards have agreed to the all-share deal after months of talks. Avon would give São Paulo-based Natura Cosméticos a bigger share of the market in Brazil and other Latin American countries, as well as in Europe and Asia.

Natura bought the Sussex-based Body Shop from L’Oréal in a €1bn (£877m) (£877m) deal in 2017. It also owns the high-end skin and haircare brand Aesop and is already Brazil’s largest cosmetics company with revenues of $3.4bn in 2018, up 36%. It has a market value of about $6.2bn.

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