L'Oreal Buys Stake in Swiss Skincare Company Galderma — Update

By Mauro Orru and Andrea Figueras

L'Oreal agreed to buy a minority stake in Swiss skincare company Galderma valued at $1.85 billion at market prices, banking on its dermatology portfolio.

The French cosmetics giant said it was acquiring a 10% stake in Galderma from EQT-led Sunshine SwissCo, Abu Dhabi Investment Authority and Auba Investment Pte. L'Oreal didn't disclose the value of the stake, but said it would fund the deal through cash and credit lines.

A 10% stake in Galderma is valued at roughly 1.59 billion Swiss francs, equivalent to $1.85 billion, based on the stock's closing price on Friday of CHF66.96.

The stake purchase comes nearly a year after L'Oreal completed its acquisition of Australian luxury-beauty brand Aesop in a $2.5 billion deal, including debt.

Galderma was founded as a joint venture between L'Oreal and Nestle, but the French beauty group sold its 50% stake to the Swiss consumer-goods giant a decade ago.

For Galderma, the deal comes months after the company became public in one of the biggest initial public offerings of the year, reaching a market value of about $14 billion. At that time, the listing of the Swiss company was the largest initial public offering of 2024 and it remains the third biggest year-to-date after Lineage and Puig Brands, according to Dealogic data.

Following the transaction, Galderma said it doesn't plan to make any changes to its board of directors, while L'Oreal said it wouldn't seek representation on Galderma's board.

The companies also agreed to work toward a new research and development scientific partnership. The aim of the deal is to jointly develop new products in the field of dermatology.

Write to Mauro Orru at mauro.orru@wsj.com and to Andrea Figueras at andrea.figueras@wsj.com

(END) Dow Jones Newswires

August 05, 2024 02:35 ET (06:35 GMT)

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