Coudert Brothers last week advised L’Oréal, the world’s largest cosmetics maker, on its acquisition of Mininurse, one of China’s most popular cosmetics brands. L’Oréal is one of the many foreign cosmetics companies that are establishing manufacturing operations in various provinces.
Jingzhou Tao, managing partner of Coudert Brothers’ Beijing office, said the deal “helped our client in its expansion into China”
“We have assisted numerous multinationals and major Chinese companies since we established our office in Beijing 25 years ago.”
Since China’s accession to the World Trade Organization two years ago, he said many of the legislative restrictions on foreign firms were gradually being relaxed and some had been removed altogether. As well as expanding the opportunities for foreign investors to enter the Chinese market, he said this was also accelerating the growth of existing foreign enterprises.
L’Oréal first entered the Chinese market in 1997. In 2002 it recorded sales of US$143 million ($185 million) and in the first six months of 2003 achieved a 66 per cent growth in sales in local currency terms. The group has rolled out its core brands in China, holding several market-leading positions consisting of L’Oréal Paris in premium colorants, Maybelline in make-up, Vichy in pharmaceuticals and Lancôme in selective distribution.
The law firm said according to a report by the China Association of Fragrance Flavour and Cosmetics Industry, foreign and Sino-foreign joint-venture cosmetics companies account for 80 per cent of total market share in China. Mininurse, launched in 1992, was one of China’s top three domestic skincare brands, with a current 5 per cent market share.
Associates Jie Tang, Ning Lu and Yuanming Wang were extensively involved in the acquisition. Other team members included Gang Zhao, Lu Chai, Huiyan Qiu, Jing Zhou, Ye Hong, Jian Qiu, Ying Wang, Xing Bi, and Cecily Pang from Coudert Brothers’ China practice group.