French factory workers on hunger strike; Rumours abound over L’Oreal share buyback

21 Oct

French factory workers on hunger strike, one hospitalised

(original story in Le Monde)

The negotiations ended Friday 18 October, between the seven union members from Solidaires Unitaires Democratiques (SUD), on hunger strike for a month, and the management of PSA Poissy. Three among them were taken ill, and one of them was taken to the hospital in Poissy by the emergency services.
According to Freddy Bruneel, departmental secretary of the trade union Solidaires Yvelines, who reported this information, “the delegation of PSA Poissy remain obtuse and indifferent to the distress of their employees.” “They are on the edge psychologically,” confided the doctor of the group who accompanied these workers, cited by Le Parisien.
Installed in tents in front of the railings of the third pole of PSA a Poissy, among the Yvelines, the seven members of SUD-Auto, part of the trade union Solidaires, denounced as one the “making of posters” and the “syndicalist repression” as reason for their belonging to SUD, but also the “repeated attacks of moral and emotional harassment” dating back several years.

New negotiations started at the start of the afternoon aiming at ending the crisis dragged on late into the evening between the unionists, the deputy-constable of Saint-Germain-en-Laye, Philippe Court, a representative of the labour administration and the management of PSA Poissy.
“There is a common desire to advance things. This situation is not agreeable for the syndicalistes or for the firm,” intimated a spokesperson of PSA-Poissy. “They have a job which awaits them at the factory, but if they do not want to restart their work, they can also form a part of the plan of voluntary departures from the group,” she added.

The hygiene situation of the unionists was strained this week, according to the group of local doctors, of which several were members of the League of Human Rights, which accompanied the strikers. “The slightest infection, the slightest trauma occurring in these conditions could have grave implications for the medical plan,” warned the doctors on Wednesday.
The home secretary of the party of the left, François Delapierre, demanded Tuesday that the minister of the economy, Pierre Moscovici, write to the head of the PSA Philippe Varin supporting the demands of the employees who “are risking today their lives”. On Tuesday 8 October,the old spokesperson of the NPA, Oliver Besancenot, came to lend his support to the strikers.

L’Oreal re-acquires its possessions

(original story in Le Monde)

L’Oréal is shopping to buy back its possessions. The global number one in cosmetics announced, Thursday 17 October, its agreement with the Japanese beauty giant Shiseido, for the repurchase of Decléor, the primary world aromatherapy brand, and Carita, which was the hairdresser of all Paris, before launching its beauty products. The price tag for these two brands, dozing in the bosom of the Japanese group, reached a height of €230million.
L’Oréal counts on laying its hands on these brands bought up in 1986 by Shiseido, which made altogether €100m in turnover and is very prominent in the market for professional skincare in beauty salons, spas and hairdressers. For An Verhulst-Santos, director general of the division of professional products at L’Oréal, “the outlook for international development particularly (of these two brands) are very promising.” An accord could be signed within the next few weeks.
With this exercise, Shiseido – which still achieves half of its sales in Japan – is pursuing its strategy of re-centering on Asia and the redrawing of its perimeter to preserve its most profitable activities. The group has suffered since the start of 2013 with faltering sales in Europe. In 2012, it had to endure a very costly restructuring of its American relation, Bare Essentials, and has since then preferred to bet on its promising results in China.
These twelve last months, L’Oréal has realised a good number of acquisitions, at all latitudes. In Brazil, the French group announced the acquisition of a majority stake in the Emporio Body Store chain, through its close relation The Body Shop. It also bought an important participant in beauty from Kenya, Interconsumer Products, and even the make-up company Vogue in Colombia. In the United States, the group topped off its coverage of hair salons by taking in hand Emiliani Enterprises, and Urban Decay, a luxury make-up brand. In China, it acquired Magic Holdings, major specialist in beauty masks.
The group, presided over by Jean-Paul Agon, is diversifying its acquisitions in the hope that one among them will become strongly profitable. Something in the mould of Kiehl’s, the American brand which made $35million (€25million) in operating income when it was bought by L’Oréal in 2000 and which posted since then annual sales of $500million. The group has kept the company in its portfolio happily for three years, along with the nail varnish makers Essie.

In a global cosmetic market of which the growth slowed in the first quarter, L’Oréal showed that its competitivity is still improving, with a record management result for the first six months of the year, of €2,04 billion.
The health of the world cosmetics leader is scrutinised as much by analysts as the date of an eventual recalibration of L’Oréal’s capital approaches at a rapid pace. The agreements on the right of preemption reflect those of the principal shareholders of the group – the Bettencourt family (30.3%), as well as the Swiss group Nestlé (29.3%), which has for forty years held a capital stake – are due to expire in April 2014. “It is understandable that the administrative board of Nestlé is asking itself whether this participation is worth almost €22billion,” intimated Jean-Paul Agon in an interview with the monthly Capital in October. He recalled “that the global pact which forbids Nestlé any attempt at the capital of that residing with Liliane Bettencourt remains, and until six months after its expiration.”
The daughter of Liliane Bettencourt, Françoise Bettencourt-Meyers and her husband, Jean-Pierre Meyers, have declared that they do not intend to end their participation either. Jean-Paul Agon, without unveiling the climax of this serial, did not dismiss a repurchase of the shares of Nestlé. “I have already reported that we have significant financial capabilities. Our stake in Sanofi, obviously a financial reserve, represents some eight to nine billion euros,” he specified in Capital. There remains €13billion to find to repurchase the shares retained by Nestlé. These are not petty purchases. The supporters of economic nationalism are agitating for such a scenario. The analysts are as favorable, for purely financial reasons, for an acquisition of these shares in L’Oréal.



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