Coty originally made a bid back in March to acquire Avon for $10bn, before this was upped last month to $10.7bn.
This offer has now been withdrawn by Coty, which claims that the US beauty company took too long to respond to its offer.
"Two months is enough," said Coty chairman Bart Becht after the company had given Avon until Monday night to respond.
In a letter sent to Avon on Monday, Becht said "your total lack of engagement with us leads us to believe that you remain reluctant to explore a friendly, negotiated combination on a reasonable timetable.”
"Consequently, as our deadline to begin discussions expired today, our proposal is withdrawn."
Avon has suffered a big decline in sales and profits, and its share price had fallen heavily before the Coty offer, with the future of the company and its leadership far from certain, following several controversies highlighted at the start of the year.
The beauty firm had asked Coty for time to consider the $10.7bn bid following the announcement of its new chief executive Sheri McCoy, who stated her first priority was to stabilize the Avon business.
Avon named Johnson & Johnson executive Sherilyn McCoy as its new CEO last month, ending the company’s four month search to replace Andrea Jung.
Jung announced she would become executive chairman at the cosmetics direct seller at the end of last year, opening up the search for a new CEO.
Since then, Avon received the improved Coty bid and also reported a big fall in its first quarter profits as sales for the period dropped again on the back of a shrinking direct sales workforce.
Sales revenues slipped 2 percent to $2.58bn for the period, representing a 1 percent fall in unit sales, a figure that was impacted further by increasing competition in the developing market of Brazil, together with lower sales growth in the Asia Pacific region.
Now, according to Reuters, with the withdrawal of Coty’s offer, Avon’s share prices have also plummeted.