Chapter 595 Agreement reached
"It seems that the Rothschild family is somewhat unwilling to accept their losses, Your Highness."
"What do you mean, Ms. Weber?"
After personal assistant Zhang Junning handed Ashley Weber's order to Barron, he walked to the window, looked at the scenery in the yard that was already covered with green, and asked easily.
"Someone is investigating our company's financial transactions. If nothing unexpected happens, it must be Rothschild's people."
"Are you sure?"
Ashley's voice came from the phone as a matter of course:
"All signs indicate that it is them. Don't forget, Your Highness, I also have my own channels. I won't make mistakes in this matter."
"That's normal. After all, they lost a lot of money before. At least they need to figure out whether you do that for a bigger purpose. If it were me, I would investigate it first."
"Let's not talk about this for now. Nestlé Group has already settled it..."
Hearing Ashley's words, he smiled and said:
"This is good news, well done."
Before this, Ashley Weber helped Barron negotiate with Nestlé Group, hoping to obtain their 29.44% of L'Oreal Group shares through equity swaps.
Originally, this matter was quite difficult, after all, Nestlé Group has been "allied" with L'Oreal Group for more than 20 years.
However, since the beginning of this year, affected by the subprime mortgage crisis, high inflation has caused a decline in the purchasing power of European and American people. The first quarter financial report of L'Oreal Group is not good, and there are reports that they are preparing to lower their profit expectations for this year, which has also caused its stock price to fall from more than 100 euros at the beginning of this year to around 70 euros at this time, a direct drop of nearly 30%!
According to Barron's request, the conditions proposed by Ashley Weber to Nestlé Group are really tempting - they proposed that if the share price of L'Oreal Group is lower than 120 euros per share in the next 8 years, then they have the right to purchase the shares of L'Oreal Group held by Nestlé Group at 120 euros per share at any time; if the share price of L'Oreal Group is higher than 120 euros per share in the next 8 years, then they have the right to purchase the shares of L'Oreal held by Nestlé Group at the current share price at any time.
Of course, the premise is that if they buy the L'Oreal Group shares held by Nestlé Group before April 2014, they need to obtain the permission of the Bettencourt family - because according to the agreement reached between Nestlé Group and the Bettencourt family before 2014, if both parties sell their shares in the L'Oreal Group before 2014, the other party has priority.
If Barron and his team buy the L'Oreal Group shares held by Nestlé Group after the expiration of the agreement between the two parties in April 2014, then there is no need to confirm with the Bettencourt family and the transaction can be completed directly.
This agreement means that Barron has guaranteed to Nestlé Group that the minimum price for them to acquire the L'Oreal Group shares held by the other party is 120 euros per share.
You know, the current share price of L'Oreal Group is about 70 euros, and the price of 120 euros per share is more than 70% premium!
Even compared with the share price of L'Oreal Group of about 100 euros at the beginning of the same year, it is still 20% premium - the share price of L'Oreal Group has not yet reached 120 euros per share.
And even if the share price of L'Oreal Group really rises and exceeds 120 euros per share in the next 8 years, Nestlé Group can still sell its shares in L'Oreal Group to Barron at a higher price.
To put it bluntly, this is a stock option agreement with a guaranteed nature that is far higher than the current share price of L'Oreal Group.
The only thing Nestlé Group needs to do is to make sure that the shares of L'Oreal Group held by it will be sold to Barron and others.
In any case, it is not a loss for them.
Of course, this agreement is not a loss for Barron - it seems that a higher price needs to be paid to acquire the shares of L'Oreal Group, but the key is that the share price of L'Oreal Group is very low now, but he can't buy it.
Yes, they did quietly buy shares of L'Oreal Group in the secondary market, but at best, they could only buy a few sporadically.
You should know that the shares of L'Oreal Group held by the Bettencourt family and Nestlé Group alone exceed 60% of the total share capital.
Don't even think about buying shares from the Bettencourt family. Even if they have internal conflicts, it is more difficult to buy their shares than from the Nestlé Group.
Moreover, it should be noted that the agreement signed by the Bettencourt family and the Nestlé Group to restrict the sale of L'Oréal Group shares is a restriction on both parties. Even if Barron can buy the L'Oréal Group shares held by the Bettencourt family before 2014, he needs the permission of the Nestlé Group.
Moreover, if you really want to buy shares from them, how can you buy them at the original share price? A premium is definitely indispensable-just like when Electricité de France bought British Energy Group, it paid a 35% premium!
And Barron also knew that in his previous life, the Bettencourt family had repurchased 8% of the L'Oréal Group shares from the Nestlé Group for 6.5 billion euros in 2014. At that time, the market value of the L'Oréal Group was more than 82 billion euros and the share price was around 135 euros per share.
Then five years later in 2021, the market value of the L'Oréal Group has reached more than 223 billion euros.
Even if he bought the L'Oreal Group shares held by Nestlé Group at a price of 120 euros per share before that, the corresponding market value of L'Oreal Group was only more than 72 billion euros, which was still not a loss.
And L'Oreal Group's position in the beauty industry is very important to Gucci-Hermès Group.
By taking over L'Oreal Group, Gucci-Hermès Group can make up for their shortcomings in beauty in one fell swoop.
At least now that the agreement with Nestlé Group has been signed, it is determined that the shares of L'Oreal Group they hold will eventually belong to Barron-even if the Bettencourt family wants to buy L'Oreal Group shares from Nestlé Group, with this agreement, Nestlé Group will not be able to sell.
This means that they can almost regard the 29.44% of L'Oreal shares held by Nestlé Group as their own.
In addition to the shares of L'Oréal Group that they secretly purchased in the secondary market, after completing this acquisition, Barron's shares of L'Oréal Group will exceed those of the Bettencourt family, making him the largest shareholder of L'Oréal Group.
Of course, if he can also buy the Bettencourt family's shares of L'Oréal Group, he will be able to privatize L'Oréal Group.
Before this, Gucci-Hermès Group first prepared to complete the privatization of Hermès.
Affected by the subprime mortgage crisis, the stock price of Hermès has also fallen accordingly, but it is still early. When the subprime mortgage crisis breaks out completely and affects the European stock market, they will start to increase their holdings of Hermès shares in the secondary market.
In addition, some members of the Hermès family will also be affected by the subprime mortgage crisis and will have the idea of selling shares of Hermès. At that time, Gucci-Hermès Group will also take it together.
Finally, together with the remaining shareholders of the Hermès family, complete the privatization of Hermès and delist it.
After all, Hermès went public mainly to facilitate financing, but the Gucci-Hermès Group has the support of Barron and is not short of funds, and their earnings are relatively stable, so there is no need for them to go public.
