Billionaire Reinold Geiger takes L’Occitane private

The board of directors of L'Occitane International S.A. announced on April 30, 2024, that L'Occitane Groupe S.A. - the controlling shareholder of the Company - has offered to acquire all shares.

Listed on the Hong Kong Stock Exchange in 2010, the L'Occitane Group was a pioneering company in the Asian stock market. Reinold Geiger, president of the brand, acquired the company in 1996 from its founder, Frenchman Olivier Baussan, who had created the brand twenty years earlier in Manosque, Provence. Its products and the use of natural ingredients quickly captivated audiences in France and internationally. The L'Occitane Group now includes eight cosmetic brands and over 3,000 points of sale in 90 countries. Its annual turnover now stands at €2.13 billion.

In recent months, several companies listed on the Hong Kong Stock Exchange have explored privatization options to exit a vulnerable stock market. The Chinese economy is still sluggish, and companies, especially European ones, fear that shares may lose value.

In this context, billionaire Reinold Geiger chose to privatize the company, although he recently declared himself opposed to this approach. Since then, L'Occitane has been valued at over €6 billion; on Tuesday, the company's shares rose to 33.30 HK dollars, marking a positive leap of 12.9%, the highest ever recorded since January 2022.

What prompted this decision? The group believes that to maintain and strengthen the respective market shares of the company's brands in an increasingly competitive environment, significant additional investments are needed, especially in marketing, store renovation, IT infrastructure, and talent attraction. These investments would require additional spending to lay the groundwork for longer-term growth.

Until March 2024, L'Occitane Group owned 72.39% of the capital. Geiger obtained acceptance of the privatization proposal from shareholders, who still hold 25.79%. The reason for this commitment from shareholders is market vulnerability: investors would now prefer short-term liquidity.

The operation will be funded by loans provided by various financial companies, such as Crédit Agricole Corporate and Investment Bank, as well as Blackstone and Goldman Sachs Asset Management. According to information provided by Reuters, these companies would support the operation with a contribution of €1.55 billion. The entire process will be assisted by the consulting bank J.P. Morgan.

L'Occitane International S.A. is a multinational multi-brand group that manufactures and markets high-end beauty and wellness products. The company operates in 90 countries and has more than 3,000 points of sale, including over 1,300 proprietary stores. Within its portfolio of high-end beauty brands that champion organic and natural ingredients: L'OCCITANE en Provence, Melvita, Erborian, L'OCCITANE au Brésil, LimeLife, ELEMIS, Sol de Janeiro, and Dr. Vranjes Firenze.