PARIS, Sept 22 (Reuters) - Shares in cosmetics group L’Oreal rose on Friday after the death of 94-year old billionaire Liliane Bettencourt, who had the largest stake in the company and whose passing may alter the ties between L’Oreal and Nestle.
L’Oreal shares were up around 5 percent in early session trading, the best performer on France’s benchmark CAC-40 index and on the pan-European STOXX 600 index.
Bettencourt’s family owns 33 percent of L’Oreal. Her daughter Françoise Bettencourt-Meyers, who sits on L’Oreal’s board along with her own son, said in a statement that the family remained committed to L’Oreal and its management team.
Nestle, which owns just over 23 percent of L’Oreal, had agreed with the founding family that the two parties could not increase their stakes during Liliane Bettencourt’s lifetime and for at least six months after her death.
“Speculation will now inevitably be re-ignited around Nestle’s intentions towards its L’Oreal stake,” analysts at Jefferies wrote in a research note. “This holds out the prospect of L’Oreal either buying in the stake, or perhaps even Nestle buying L’Oreal outright.”
Nestle shares were up 1.1 percent while shares in healthcare company Sanofi, in which L’Oreal also has a 9 percent stake, also advanced by around 1 percent. (Reporting by Sudip Kar-Gupta; Editing by Laurence Frost)