looking at options to reduce L'Oreal stake: Bloomberg
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[February 10, 2014]
ZURICH (Reuters) — Nestle <NESN.VX>,
the world's biggest food company, is looking at ways to reduce its
$30 billion stake in cosmetics firm L'Oreal <OREP.PA>, Bloomberg
reported on Saturday, citing sources with knowledge of the matter.
Nestle has told L'Oreal of its intentions, and the two companies
have discussed the issue with banks, though no decision over the
possible timing of any sale, which could take years, has been made,
the report said.
Nestle is under pressure to make its intentions clear towards the
cosmetics firm, its partner of 40 years, when the ties that bind
them loosen in April.
The Swiss company owns a 29.5 percent stake in L'Oreal and the
expiry of a 10-year right of first refusal agreement with the
Bettencourt family in April should make it easier for Nestle to
sell, though it has no urgent need to do so.
Talks have picked up as the expiry of restrictions approaches, the
A spokeswoman for L'Oreal declined to comment. Nestle declined to
comment beyond pointing to a statement on its website that says the
board is addressing the future of the stake "with great attention in
the framework of the group's global nutrition, health and wellness
[to top of second column]
L'Oreal chief executive Jean-Paul Agon told Le Monde newspaper last
month the French cosmetics giant has the means to buy the stake held
by Nestle, thanks to its net cash position and 9 percent stake in
drugmaker Sanofi <SASY.PA>.
Agon said the shares held by Nestle could be canceled if L'Oreal
repurchased them, thereby boosting earnings per share for remaining
(Reporting by Alice Baghdjian in Zurich
and Pascale Denis in Paris; editing by Ruth Pitchford)
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