French cosmetics giant L'Oréal has put forward a proposal to acquire Chinese skin care company Magic Holdings International Limited.
In a “joint announcement”, L'Oréal and Magic Holdings revealed news of the proposal, with L'Oréal's proposed price for the acquisition set at Hong Kong dollars $6.5bn (US$834m or £539m). The proposed price per share is HK$6.30.
It was also announced that L'Oréal's proposal is being supported by Magic Holding's Board of Directors, with six key shareholders, which represent 62.3% of the company's equity, already committed to supporting the proposal. However, the deal is subject to the approval of the Ministry of Commerce of the People's Republic of China (MOFCOM).
Magic Holdings, a specialist in cosmetic facial masks and one of China's leading brands in the category, achieved a turnover of approximately €150m in 2012, up 29% on 2011. L'Oréal aims to develop the brand by contributing its science based expertise.
L'Oréal currently employs 3,500 people in China and has a Research and Innovation centre in Shanghai, as well as two plants in Suzhou and Yichang.
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