L'Oreal buys up organic cosmetic player

By Simon Pitman

- Last updated on GMT

Related tags L'oréal Cosmetics

The world's leading cosmetic player has further expanded its
position in the naturals market with the acquisition of French
Laboratoire Sanoflore, one of the founding companies specialising
in the manufacturing of certified organic cosmetic products in the

The move follows on from the company's acquisition of the Body Shop, which was approved by EU authorities in June of this year. L'Oreal paid a total of £652m to secure a controlling stake in what is probably the best recognized player in the naturals market.

The latest deal sees the French cosmetics giant acquiring a significantly smaller player, with a turnover of just €15m a year - 20 per cent of which is derived from overseas sales - and a pay role that includes 147 people.

Sanoflore will become a part of L'Oreal's Active Cosmetics Division - currently the company's fastest growing business area. In the company's most recent third quarter results the division's sales growth was put at 12.4 per cent, reaching €895m.

Brands in that division include Dermablend, La RochePosay, Ombrelle and SkinCeuticals.

Sanoflore was founded in south-eastern France 20 years ago. It manufactures and distributes a range of cosmetic and aromatherapy products that are distributed in pharmacy and speciality shops, mainly in France.

Its brands include hair care, hand care, body care, massage, baby care and slimming products, as well as a comprehensive range of face care products.

Currently the company oversees all aspects of the production for all its lines, all the way from buying raw materials from farmers, right the way up to the finished formulation.

According to the company it accounts for all aspects of the production, which in turn helps to ensure its Ecocert certification allowing all of its products to be labelled as organic.

"Having Sanoflore on board will enhance our ability to be even more responsive to the aspirations of each of our customers, "​ said Brigitte Liberman, managing director of L'Oreal's Active Cosmetics division.

Pointing out that the move will enable Sanoflore to tap into L'Oreal's extensive research and development facilities, Liberman also stressed that the move will also enable Sanoflore to internationalise its business portfolio.

Likewise L'Oreal CEO Jean-Paul Agon has already announced a comprehensive plan to further internationalise the Body Shop, that is likely to take in emerging markets such as China and Brazil.In keeping with this aim Agon has also made it clear that he wants to increase the company's footprint in the naturals and organic arena, stating that current demand was too great to ignore, indicating the possibility of further acquisitions in this area.

With consumers continuing to opt for cosmetic products that are deemed to be natural and therefore safer, sales of natural & organic cosmetics are projected to surpass the €1 billion mark for the first time this year, according to market research provider Organic Monitor.

The increase in spend means that the market is growing by an average of 20 per cent a year, according to the researcher, significantly above that of most other categories in a market where activity has remained largely stagnant in recent years.

The market demand for natural products is now feeding a vastly increased product offering, which can be seen by taking a look at retail shelf space around Europe, where a dizzying array of products purporting to have natural and organic ingredients seem to abound.

And if L'Oreal continues on its current path, a significant proportion of those products are likely to carry the company's logo in the future.

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