NEW YORK (AP) — Private investment firm Cerberus Capital Management is taking a majority stake in Avon's North American division.

The companies said that they believe the partnership will help to improve Avon's performance and boost shareholder value.

Cerberus will get an 80.1 percent interest in Avon North America in exchange for a $170 million equity investment. The North American unit will be separated from Avon Products Inc. into a privately-held company that will include the U.S., Canada and Puerto Rico. It will be managed by New York-based Cerberus.

The new company will enter into a licensing agreement with Avon for the use of the Avon brand, the Avon product portfolio and other intellectual property. There will also be a transition services agreement to include IT and research and development.

Pablo Muñoz, current president of Avon North America, will leave the company, effective January 4. Cerberus will name a new CEO for the business.

Cerberus will also make a $435 million investment for a minority stake in Avon Products Inc.

Avon CEO Sheri McCoy said in a written statement that the New York-based company will focus resources on its top markets, adding that the investment from Cerberus will give it the financial flexibility needed to implement plans for its international business.

Avon's board has approved the deal, which is expected to be completed in the spring. Avon will trim its board from 12 to 11 members.

The beauty products company also announced that it is suspending its quarterly dividend, starting in 2016's first quarter.

Avon Products shares rose 4 cents to $4.13 in afternoon trading Thursday. Avon Products shares have fallen more than 55 percent over the past year.