Switzerland's food giant Nestle has acquired a 26.4 per cent direct stake in the French cosmetics firm, L'Oreal.
Nestle and L'Oreal's majority shareholder and founding family, the Bettencourts agreed to simplify. their joint holding in the cosmetics empire.
Under the terms of the pact, the holding company for Nestle and the Bettencourt family--Gesparal--will merge with L'Oreal. The move means that Nestle's 49 per cent stake in Gesparal will become a 26.4 per cent direct holding in L'Oreal.
Gesparal currently owns 53.8 per cent of the capital and 71.7 per cent of voting rights in the French company, producer of cosmetics lines such as Maybelline and Lancome.