Full Breakdown
L’Oréal Increases Stake in Galderma to 20%: A Strategic Move in Aesthetics
12/8/2025, 8:05:38 PM
Overview of the Acquisition
L’Oréal SA has announced its decision to increase its stake in Galderma Group AG from 10% to 20% by acquiring an additional 10% from a consortium led by EQT, which includes the Abu Dhabi Investment Authority and Auba Investment Pte Ltd. This transaction, valued at an undisclosed amount, is expected to close by the first quarter of 2026. The move underscores L’Oréal's commitment to expanding its presence in the rapidly growing injectable aesthetics market, which is projected to reach $18.12 billion by 2032.
Background and Context
Galderma was originally established in 1981 as a joint venture between L’Oréal and Nestlé. After L’Oréal sold its 50% stake in 2014, Galderma was acquired by EQT in 2019. The company went public on the SIX Swiss Exchange in March 2024, achieving significant success with its stock price tripling since the IPO. L’Oréal's initial investment in Galderma occurred in August 2024, marking its return to a company it helped create.
Strategic Implications
L’Oréal's CEO, Nicolas Hieronimus, emphasized that aesthetics is a crucial area adjacent to their core beauty business, stating, “Our initial strategic investment made in 2024 in Galderma has proven very successful, and therefore we are eager to solidify and extend the partnership further.” Analysts view this acquisition as a strategic alignment, as Galderma brings scientific expertise in dermatology, while L’Oréal contributes its extensive market reach and brand strength.
Governance Changes
As part of the agreement, Galderma's board will consider appointing two non-independent directors from L’Oréal, replacing the current representatives from the EQT-led consortium. This governance change is indicative of L’Oréal's growing influence within Galderma while maintaining the latter's operational independence under CEO Flemming Ørnskov.
Market Context and Growth Potential
The global injectable aesthetics market has seen substantial growth, with a compound annual growth rate of 7.5%. L’Oréal's Dermatological Beauty division, which includes brands like CeraVe and La Roche-Posay, has also experienced significant growth, further motivating the company's investment in Galderma. The partnership aims to explore synergies between injectables and topical treatments, enhancing product development capabilities.
Criticism & Opposition
Despite the positive outlook, some analysts express caution regarding L’Oréal's long-term intentions. Jefferies equity analyst Benjamin Jackson noted that while L’Oréal may explore full control over Galderma's ex-Therapeutic Derm franchise, it is unlikely to pursue Galderma's prescription drug business. This perspective highlights the complexities of L’Oréal's strategic interests in the dermatology sector.
Official Statements & Responses
Galderma's CEO, Flemming Ørnskov, remarked on the increased investment, stating, “We are pleased with L’Oréal’s increased investment, which affirms our direction and the meaningful value creation we expect in the years ahead.” L’Oréal has reiterated its commitment to supporting Galderma's strategy and independence, signaling a collaborative future.
What's Next
The transaction is subject to customary regulatory approvals and is expected to finalize by early 2026. As L’Oréal continues to expand its footprint in the dermatological beauty market, further developments in their partnership with Galderma are anticipated, particularly in scientific research and product innovation.
