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L’Oréal has acquired a 10 per cent stake in newly listed dermatology company Galderma, in a move that takes the beauty giant back into the injectables market after 10 years in traditional cosmetics.
The French beauty giant acquired the stake for an undisclosed sum from a consortium led by Swedish private equity group EQT. The consortium, which has owned Galderma for five years, recently took the company public and remains a shareholder.
Nicolas Hieronimus, chief executive of L’Oréal, said the deal “allows us to explore partnering in the fast-growing aesthetics market, a key adjacency to our own pure beauty play”.
Galderma, which sells everything from acne treatments to aesthetic injectables and fillers designed to eliminate wrinkles and alter facial features, said it had formed a scientific partnership with the French beauty giant to develop anti-skin ageing technologies. Analysts estimate the stake to be worth €1.7bn.
Based in Zug, Switzerland, Galderma was established in 1981 as a joint venture between Nestlé and L’Oréal. In 2014, Nestlé bought out L’Oréal’s 50 per cent stake. The company was then acquired by the consortium led by EQT for $10bn in 2019.
“L’Oréal is moving left-field [with] beauty tech/devices and now injectables, in a notable shift away from traditional cosmetics, perhaps a sign of a view on the future of the beauty wallet,” wrote Jefferies analyst Molly Wylenzek, adding that L’Oréal probably took the stake with a view to “higher ownership and control over time”. L’Oréal shares were down 1 per cent in early trading on Monday, amid broader turbulence in global stock markets.
The deal comes after Galderma’s investors, which also include the Abu Dhabi Investment Authority and Singapore’s GIC, took the company public in Switzerland in March.
The initial public offering for Galderma raised about SFr2.3bn at a price of SFr53 a share. Most of the proceeds from the IPO were intended to repay and refinance Galderma’s debts.
Shares in the company have since risen to about SFr67. Galderma’s market capitalisation is roughly SFr16bn.
