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L’Oréal and Nestlé Form New Venture For Nutrition Line

PARIS -- In a unique partnering of cosmetic and food companies, L'Oreal and Nestle -- one of L'Oreal's key shareholders -- have formed a joint company to market nutritional supplements for skin, hair and nails.<P>The new company, Laboratoires...

PARIS — In a unique partnering of cosmetic and food companies, L’Oreal and Nestle — one of L’Oreal’s key shareholders — have formed a joint company to market nutritional supplements for skin, hair and nails.

This story first appeared in the June 26, 2002 issue of WWD.  Subscribe Today.

The new company, Laboratoires Inneov, plans to market the products globally starting next year. A spokesman for L’Oreal declined to elaborate.

In a statement Tuesday, L’Oreal said Laboratoires Inneov products would benefit from Nestle’s nutritional research and L’Oreal’s research efforts in dermatology. L’Oreal is majority-owned by Nestle and the family of Liliane Bettencourt — the daughter of the founder of L’Oreal — through the Gesparal holding company.

The deal is subject to regulatory approval. The company, a 50-50 partnership, will be headquartered in France.

While the company has not announced where the products will be sold, some believe mass stores are the most likely distribution channel.

“It wouldn’t make sense for them to sell it through the professional end of their business, in salons,” said Walter Siegordner, president of the Aurora Group, a Hackensack, N.J.-based beauty and nutritional supplement manufacturer. “The education wouldn’t be there to support the products.”

Sales of nutritional supplements, or ingestible vitamins that purportedly have beauty and health benefits, have hit a decline in the U.S. mass channel. According to data from Information Resources Inc., sales of supplements in food, drug and mass stores for the year ended April 28 were $1.2 billion, down 2.1 percent. Data excludes sales in Wal-Mart stores. But the number of companies targeting beauty-specific ailments is strong. Avon entered the category in May 2001, joining such manufacturers as Aveda.”