This article directly stems from the research process for our European single family office database. Our list of European single family offices includes the most important family investment vehicles that invest in various areas, such as financial markets, real estate, venture capital, private equity and renewables.
How did the Bettencourt family earn their fortune?
Their fortune stems from one main source, the 33% share in the biggest beauty company worldwide, L’Oreal, which was founded by the grandfather of the current head of the family, Francoise Bettencourt Meyers, richest women in the world with an estimated wealth of 56,4 billion dollars according to Forbes. L’Oreal was found by Eugene Schueller a French of German descent in Paris as he developed in 1909 a hair dying formula he named Oreale. In 1919 he founded the company which eventually will become L’Oreal as the society of safe hair dying. As it started in hair dying the product range offered by L’Oreal is much wider and more than 80000 people work for the company as of today. In the last year, L’Oreal made a revenue of nearly 27 billion euros, and had a profit of 4,92 billion euros, resulting in a margin of 18.3%.
How did L’Oreal develop?
From a hair dying company employing three people in 1920, to 86000 employees in 2019 was a long way and marked by many mergers and acquisitions. In 1964 L’Oreal acquired the perfume brand Lancôme which is still sold today, in 1965 Garnier the second most successful beauty brand in the L’Oreal portfolio. In 1970 Biotherm a company focused on face refreshers was added to the portfolio. In 1973 was the first time a venture into the pharmaceutical market, with the acquisition of Synthelabo which was later merged to Sanofi a still operative pharmaceutical company. In 1996 was Maybelline acquired, a US mass make up company, making L’Oreal the undisputed leader in the beauty industry in the United States. Very successful products are for example Garnier Fructis or the Giorgio Armani perfumes, especially Acqua di Gio. Until today the companies Nestlé and L’Oreal are closely tied, with Nestlé having a share of over 20% of the company.
Does the Bettencourt family have a Single Family Office?
Yes, they do, it is called Tethys Invest. According to a French newspaper, it is active in investment in diverse areas, so far mainly the health industries. It is managed by the former chief executive officer of the Lazarus bank an intimate to the Bettencourt family. Tethys invest is structured as a private equity fund with a capital of more than three billion euros and it will be the institution in the Bettencourt universe who receives the yearly dividends from L’Oreal, guaranteeing also in the future a steady and stark inflow of capital. For the year 2015, the dividend payments for the Bettencourt share of L’Oreal will mount up to 500 million euros and stay in that volume in the consecutive years. Tethys Invests’ founding stands in stark contrast to the asset management of Francoise Bettencourt Meyers mother Liliane Bettencourt who was at the end of her life under the guardianship of her grandson because she gave away nearly one billion in assets to a famous French photographer who was later sued for taking advantage of her. The daughter’s investment strategy differs greatly from her mother’s activities in the previous decades.
How does the Bettencourt family invest?
One of the first acquisitions carried out by Tethys invest was into Elsan who is operating Frances second biggest private hospital. Strengthening and demonstrating the health focus of the single family office. Another investment also in the health segment is the acquisition of Sebia, a provider of medical equipment and technology for in-vitro diagnostic testing. Here Tethys invest acquired a majority stake and added it to his portfolio. A third company where Tethys is invested, is the company Provepharm Life solutions, a company who develops and commercializes pharmaceutical drugs. Although the statement at funding Tethys Invest was to investments in diverse economic sectors, so far the focus of the single-family office had clearly been the health sector. Relating it to the knowledge gained in the health-related field of skin care these investments make a lot of sense and could produce synergies for the Bettencourt Family. One investment outside of the health sector of Téthys Invest is a 20% stake in Galileo Global Education, a provider of multidisciplinary and global education who wants to reinvent the way private education is offered.
This article is part of our detailed report “The single family offices of Europe’s richest families“.
Picture source: Jasmin Quaynor