Nestlé sweet on L’Oreal?
Death may prompt takeover bid
THE death of L’Oreal billionaire Liliane Bettencourt could prompt a takeover bid by Smarties-maker Nestlé.
Bettencourt, the world’s richest woman, died on Thursday aged 94.
Her family founded the French beauty giant – famed for its “Because you’re worth it” advertising slogan – and still own 33%.
Nestle, whose own ads include “Have a break, have a KitKat”, control another 23%.
It was agreed that neither could increase their stakes in L’Oreal during Bettencourt’s lifetime, and for at least six months after her death.
However, her passing this week has prompted rumours that Nestle could make a move.
Investment bank Jefferies said: “Speculation will inevitably be reignited around Nestle’s intentions towards its L’Oreal stake. This holds out the prospect of Nestle even buying L’Oreal outright.”
The Bettencourt family’s stake in L’Oreal, which uses singer Cheryl Cole in its adverts, is worth £26billion.
Swiss firm Nestle has first refusal on any situation where the Bettencourt family decide to sell their stake.
However, others have downplayed the prospect of Nestle upping its stake.
Analysts at UBS bank ranked the chances as low.
Meanwhile, a big investor in Nestle, Third Point Management, has previously called on the firm to sell its holding in L’Oreal.