L’Oréal Deepens Dermatology Focus, Doubles Galderma Stake
## The Event in Detail
**L'Oréal SA** has agreed to acquire an additional 10% stake in **Galderma Group AG**, doubling its total holding to 20%. The French cosmetics giant will purchase approximately 24 million shares from an investor consortium led by private equity firm **EQT AB**. While the official purchase price was not disclosed, the stake is valued at approximately 3.9 billion Swiss francs ($4.85 billion) based on **Galderma**'s closing share price on the preceding Friday.
The transaction is anticipated to close in the first quarter of 2026. Following the deal, **Galderma** is expected to consider the appointment of two **L'Oréal** representatives to its board, replacing directors from the selling EQT group. **L'Oréal** has also stated that it does not have plans to further increase its stake at this time.
## Market Implications
The announcement triggered an immediate and distinct reaction in the market. Shares of **Galderma (GALD)** on the SIX Swiss Exchange surged by as much as 4.5% in early trading, reflecting investor approval of a strong strategic anchor shareholder increasing its position. Conversely, **L'Oréal's (OR)** stock fell by approximately 1.7% in Paris, a typical reaction as markets digest the significant capital expenditure. The deal also serves to reduce the number of shares held by private equity investors seeking an exit following **Galderma**'s recent initial public offering, a factor that is expected to contribute to greater stock price stability.
## Expert Commentary
Industry analysts have largely viewed the transaction favorably. Vontobel analyst Stefan Schneider noted the strategic alignment in a public statement:
> The expansion of L’Oreal’s Galderma stake makes strategic sense as Galderma brings scientific leadership in dermatology to the table and L’Oreal its expertise as the world’s leading beauty player.
This sentiment underscores the complementary nature of the partnership, enhancing both firms' competitive advantages.
## Broader Context
This acquisition is a key component of **L'Oréal**'s overarching strategy to expand its footprint in the lucrative and rapidly growing dermatological beauty sector. The move follows other recent investments, including the purchase of South Korean brand **Dr. G** and a majority stake in UK-based **Medik8**.
The deal represents a significant deepening of a historical relationship. **Galderma** was originally established in 1981 as a joint venture between **L'Oréal** and **Nestlé SA**. The timeline of ownership has evolved significantly since:
- **2014:** **Nestlé** took full control of **Galderma** by acquiring **L'Oréal**'s share.
- **2019:** Under pressure from activist investors to streamline its portfolio, **Nestlé** sold **Galderma** to a consortium led by **EQT**.
- **March 2024:** **Galderma** was successfully listed on the SIX Swiss Exchange.
- **August 2024:** **L'Oréal** made its initial move, acquiring a 10% stake in the newly public company.
By doubling its stake, **L'Oréal** is not merely making a financial investment but is re-establishing itself as a core strategic partner in a company it co-founded, positioning itself to capitalize on future growth in scientific skincare.
