L’Oreal ready to buy Nestle stake in cosmetics leader

Bottles of shampoos, conditioners and color spray are displayed at cosmetics company L'Oreal's new World hair research centre in Saint-Ouen near Paris. (Reuters)
Updated 09 February 2018
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L’Oreal ready to buy Nestle stake in cosmetics leader

PARIS: L’Oreal signalled its readiness to buy Nestle’s 23 percent stake in the world’s biggest cosmetics firm on Friday, which along with strong results lifted the French company’s shares.
L’Oreal said it could finance a purchase of the holding, which is now worth around €22.3 billion ($27.4 billion), with cash, by selling its stake in French pharmaceutical group Sanofi or through borrowing.
“If Nestle one day wants to sell, we are ready,” Chairman and Chief Executive Jean-Paul Agon said after L’Oreal released fourth-quarter earnings.
Billionaire Liliane Bettencourt’s death in September has focused attention on how L’Oreal’s founding family and its major shareholder Swiss food group Nestle would manage their stakes.
Investor Daniel Loeb, founder of hedge fund Third Point, has pushed for Nestle to sell its L’Oreal stake among his demands for the Swiss firm to speed a strategy overhaul.
“We have €1.8 billion in cash, we have the Sanofi stake. We are also a very serious and loyal and active shareholder in Sanofi, but in case we will be ready and I’m sure if it was not enough, we have many love letters from banks that have said that they would love to lend us some money.” he added.
Nestle and Sanofi declined to comment.
Shares in L’Oreal, whose brand ambassadors include Helen Mirren, Eva Longoria and Blake Lively, were up 2.4 percent in early trade, among the top gainers on France’s blue-chip CAC-40 index. Nestle shares were up 1.1 percent, while Sanofi was 0.7 percent lower.
“Scarcely a surprise, but this may excite some: An acquisition of the stake by L’Oreal, part-funded by a sale of its own Sanofi stake would be circa 10 percent accretive,” Investec Securities analysts said in a note.
At today’s stock price, L’Oreal’s 9 percent stake in Sanofi is worth more than €7 billion, according to Reuters data.
L’Oreal entered the pharmaceuticals business in 1973 with the purchase of Synthelabo. This was later merged with Elf Aquitaine’s drugs business in the late 1990s, with L’Oreal retaining a stake in the enlarged Sanofi group.
“We see this as no change to the status quo from a L’Oreal perspective. Nor do we expect an imminent about-turn from Nestle, which reiterated its commitment to the L’Oreal holding in September,” Barclays analysts wrote.


Mo-Salah to raise DHL flag in the MENA region for developmental and charitable causes

Updated 24 May 2018
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Mo-Salah to raise DHL flag in the MENA region for developmental and charitable causes

LONDON: DHL Express, the world’s leading express logistics provider, has signed a strategic partnership with Egyptian football superstar Mohamed Salah to become brand ambassador for the Middle East and North Africa (MENA) region for the next two years.
The new collaboration will see the parties working together on a series of marketing activities and corporate social responsibility (CSR) initiatives that reinforce the synergies between the core values of DHL Express as a business and Mohamed Salah as a sportsman and youth-inspirer.
The announcement made late on Wednesday in northern England comes just weeks ahead of Salah’s campaign to lead the Egyptian national team at the World Cup in Russia.
DHL’s CEO in the Middle East and North Africa, Nour Suliman, told Arab News that he was very proud of collaborating with Salah.
“Our partnership with Mo Salah is unique as it is the first contract with an individual player, but also it is a testament to the synergy of core values DHL Express and Mo Salah share — leadership, commitment, teamwork, precision, agility, determination,” he said.
When asked by Arab News about the meaning of this partnership, Salah said: “I am very proud to be the first player to partner with DHL, and I am happy to collaborate with an international brand.”
DHL did not disclose the funds earmarked for its CSR initiatives to be spent in the MENA region, and its region’s CEO said the initialtives to be developed are still a work in progress.
However, DHL said it has already significantly contributed to the development of the countries they operate in within the MENA region.
The company’s work includes supporting charities, working to help orphans, youth development, care and education among other causes.