HISS AND MAKE-UP

A BAT­TLE BE­TWEEN THE 87-YEAR-OLD MA­TRI­ARCH OF L’OREAL AND HER DAUGH­TER FOR CON­TROL OF THE WORLD’S LARGEST COS­MET­ICS COM­PANY REACHES TO THE TOP OF THE FRENCH GOVERN­MENT

The Advertiser - SA Weekend - - LETTERS / CONTENTS - WOR DS L I Z Z Y DAV I E S

A French fam­ily feud has split the world’s biggest cos­met­ics firm, L’Oreal.

A YOUNG

French chemist named Eugène Schueller cre­ated a hair dye named Auréale in the kitchen of his Paris apart­ment in 1907. With a limited range of shades and a chem­i­cal raw­ness that be­trayed its mod­est ori­gins, the colorant was far from per­fect, but it was a start. Soon Schueller had reg­is­tered his com­pany and, by 1939, he had re­named it – in a nod to his first prod­uct – L’Oréal. By the end of the 20th cen­tury, the one-man, shoe­string op­er­a­tion was no more. In its place was the largest and most pow­er­ful cos­met­ics brand in the world.

For Schueller’s de­voted only child, the up­keep of the L’Oréal busi­ness was more than a pro­fes­sional duty; it was a per­sonal com­mit­ment to him and to their tightly bound fam­ily. Even later re­ports of his Nazi col­lab­o­ra­tion and vir­u­lent anti-Semitism could not shake her fil­ial loy­alty. “I am, first and fore­most, the daugh­ter of a fa­ther,” she said in 2005.

What would Schueller make of his daugh­ter’s predica­ment to­day? Now aged 87 and the rich­est woman in France, Lil­iane Bet­ten­court is pre­sid­ing over a war­ring clan whose venomous dis­pute is threat­en­ing the com­pany she swore to Schueller she would pro­tect. A three-year row has es­tranged her from her only daugh­ter and laid bare the un­palat­able re­al­i­ties be­hind the gloss of the Parisian elite. It has also threat­ened the cred­i­bil­ity of the French govern­ment and placed a ques­tion mark over the fu­ture of L’Oréal it­self.

In 2007, Françoise Bet­ten­court Mey­ers, the in­tel­lec­tual daugh­ter of the age­ing heiress, filed a law­suit against François-Marie Banier, a pho­tog­ra­pher whom she claimed had been prey­ing on her mother for money – €1bn ($1.4bn), no less. Bet­ten­court Mey­ers’s move to sue him and have her mother de­clared legally in­com­pe­tent to man­age her own af­fairs pro­voked fury from the L’Oréal ma­tri­arch, and the bile be­gan spilling.

The fam­ily af­fair soon be­came an af­fair of state: last month, se­cret tapes recorded by the Bet­ten­court but­ler were re­leased as ev­i­dence for the Banier trial and proved to be po­lit­i­cal dy­na­mite. The tran­scripts ap­peared to show sys­tem­atic tax evasion on the part of the doyenne and her ad­vis­ers; the name of the French labour min­is­ter was heard fre­quently, as well as that of his wife who, it tran­spired, had been work­ing on Bet­ten­court’s fi­nances. Fi­nally, in a dra­matic plot twist to the sen­sa­tional soap opera grip­ping Paris, the min­is­ter in ques­tion was al­leged to have re­ceived a large – and il­le­gal – do­na­tion to the pres­i­den­tial cam­paign of Nicolas Sarkozy.

Amid all this sound and fury, how­ever, there is only one thing Lil­iane Bet­ten­court wor­ries about: the fu­ture of L’Oréal. “For 40 years I have de­voted my­self to my role as the chief share­holder of the lead­ing cos­met­ics group in the world,” the bil­lion­aire said in a de­fi­ant state­ment is­sued from her res­i­dence in ru­ral Brit­tany. “I in­tend to con­tinue with this task and hope that my daugh­ter will not desta­bilise this group, which my fa­ther and I wanted to be French.”

Those last words were a thinly veiled warn­ing. For while L’Oréal the busi­ness has for the moment re­mained un­af­fected by the whiff of scan­dal, there are fears this will not re­main the case for long. The cos­met­ics jug­ger­naut that is L’Oréal has two ma­jor share­hold­ers: the Bet­ten­court fam­ily with a 31 per cent stake, and the Swiss food gi­ant Nestlé, with 30 per cent.

Nestlé’s chief ex­ec­u­tive, Paul Bul­cke, and the Bet­ten­courts have de­nied there are any plans to change the sta­tus quo. But such has been the dy­na­mite ef­fect of “L’af­faire” in re­cent weeks that no one can be sure the L’Oréal that emerges from the saga will look the same as the com­pany that went in. And it is Bet­ten­court Mey­ers, the aca­demic more in­ter­ested in writ­ing books on the Greek gods than pre­sent­ing her­self as the face of the glam­orous brand, who is the fo­cus of at­ten­tion.

Bet­ten­court Mey­ers, 57, who al­ready has par­tial con­trol of her mother’s $23bn share in the com­pany and will in­herit fully af­ter her death, is sus­pected by Bet­ten­court’s ad­vis­ers of or­ches­trat­ing an exit strat­egy for her­self and the com­pany that would in­volve sell­ing the stake to Nestlé. Even Sarkozy has al­luded to the pos­si­bil­ity. “I would like her [Lil­iane Bet­ten­court] to re­main the owner of L’Oréal . . . and L’Oréal not to leave for an­other coun­try,” he said in a tele­vi­sion in­ter­view.

“L’Oréal is a kind of jewel, a sym­bol of French suc­cess,” says Béa­trice Collin, author of Le Mod­èle L’Oréal, a French best­seller that an­a­lysed the com­pany. “It is all about lux­ury and beauty and that, that is France.” Collin be­lieves it is a “real pos­si­bil­ity” that the Swiss share­holder could even­tu­ally take con­trol of the Gal­lic gi­ant. Should the Bet­ten­court fam­ily ever de­cide to sell its stake, it would be obliged to ap­proach Nestlé be­fore any other bid­der, and vice-versa. Bet­ten­court Mey­ers says she is “vis­cer­ally at­tached” to the com­pany. “Sell­ing up one day?” she asked in an in­ter­view ear­lier this year. “That would be a be­trayal.”

She will have to fight hard, how­ever, to emerge un­scathed by the bat­tle she is wag­ing on her mother’s camp – a close cir­cle of men Bet­ten­court Mey­ers has de­nounced as “cult-like” in their ef­forts to sep­a­rate the el­derly woman from her fam­ily. “I have only one aim: to get my mother back,” she has said. But that does not look close to hap­pen­ing. Her mother’s clan re­tort sim­ply that Françoise is merely jeal­ous, mo­ti­vated by ha­tred for a man who has ev­ery­thing she does not – charisma, vi­va­cious­ness, and the af­fec­tion of Lil­iane. She is, they say, try­ing to get her own back by at­tempt­ing to wrest con­trol of the busi­ness from her mother. Her hus­band, Jean-Pierre Mey­ers, who sits on the boards of both Nestlé and L’Oréal, is re­garded with sus­pi­cion.

Françoise is not the only one, how­ever, to ques­tion the mo­tives of the fig­ures around her mother. When asked why he had recorded about 100 hours of con­ver­sa­tions from within his em­ployer’s Parisian man­sion, for­mer but­ler Pas­cal Bon­nefoy replied that he had been scared for her. He could “no longer bear”, he said, to see her “abused by peo­ple with­out scru­ples”.

From the tapes, which prompted the ad­journ­ment of Banier’s trial, a pic­ture is painted of Machi­avel­lian ma­noeu­vrings and toe-curl­ing toad­y­ing, of shame­less greed and anti-Semitic un­der­tones. The record­ings also brought to light sug­gested tax evasion, which Bet­ten­court im­me­di­ately vowed to “reg­u­larise”. In the tapes, she is of­ten heard to be be­fud­dled or con­fused.

Other parts of the tran­scripts sug­gest that Sarkozy, ap­par­ently concerned by a ver­dict against Banier, tried to pre­vent the case com­ing to court at all. The Elysée has de­nied this. But, if true, why would the pres­i­dent have cared so much? Was it, as some ob­servers have sug­gested, be­cause he had re­ceived a sub­stan­tial do­na­tion from the Bet­ten­court fam­ily and did not want that to be made pub­lic? (This al­le­ga­tion has been dis­missed as base­less by the pres­i­dent’s staff.)

Or were his con­cerns for L’Oréal it­self, for its Gal­lic roots and its un­cer­tain fu­ture? The pres­i­dent is un­doubt­edly concerned. With its 67,000 jobs world­wide and a net profit, last year, of $2.58bn, the com­pany is more than just a busi­ness; it is a part of the na­tional psy­che. To lose it would be a heavy blow for France.

For the time be­ing, then, with the trial ad­journed, the fam­ily tragedy-cum-farce will no doubt con­tinue to en­ter­tain and ap­pal in equal mea­sure. A French pro­ducer, Thomas Lang­mann, is plan­ning a film ver­sion of the saga. But what the de­noue­ment will be – for the hero­ine and for her in­her­i­tance – is any­body’s guess.

© Guardian News & Me­dia Ltd 2010

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