Ugly Beauty: Helena Rubinstein, L'Oréal, and the Blemished History of Looking Good by Ruth Brandon

Author:Ruth Brandon
Language: eng
Format: mobi
Tags: L'Oreal (Firm), Health & Fitness, Beauty, Business, Corporate & Business History, Personal, Helena Rubinstein, Beauty & Grooming, Rubinstein, Helena, Social History, Biography & Autobiography, General, inc, Business & Economics, History
ISBN: 9780061740404
Publisher: HarperCollins
Published: 2011-01-31T10:00:00+00:00

II

In February of 1988, eight months before the purchase of Helena Rubinstein was completed, L’Oréal learned, to its “utter astonishment,”11 that it had been placed on the blacklist of the Arab League’s anti-Israel boycott committee. The committee, whose offices were located in Damascus, had been set up in 1948, when the State of Israel was established, in an attempt to strangle the new state by cutting off all Arab trade with companies linked to Israel, or doing business with it. This proved rather an empty threat at first, but took on new force after oil prices quadrupled in 1973, leaving oil-producing countries with huge surpluses of petrodollars that made them highly desirable trading partners.

L’Oréal had for many years maintained subsidiaries in Egypt, Syria, and Palestine. But although no company likes to face the prospect of losing an entire segment of the world market, it might in principle have ignored the boycott committee. Indeed, in principle it had no option but to do so, since complying with the boycott had been outlawed in France in 1981, at the start of President Mitterrand’s first term. L’Oréal, however, was not the only company involved. In 1974, Liliane Bettencourt had exchanged a large block of her L’Oréal shares for shares in the Swiss food conglomerate Nestlé—a company of which Dalle, when he retired in 1984, had become vice president. All these shares were now owned by a holding company, Gesparal, of which Liliane Bettencourt owned 51 percent and Nestlé 49 percent, and which itself owned 53.65 percent of L’Oréal. And if Nestlé, as part owner of L’Oréal, were to become involved in the boycott, that would be serious indeed: Arab markets accounted for 15 percent of its milk products exports.12

On the face of it, L’Oréal’s astonishment at being singled out by the boycott committee was logical. Helena Rubinstein did have an Israeli subsidiary—but L’Oréal had, as yet, no official ties with HR. In reality, however, the committee’s announcement came as no surprise at all, nor had the boycott committee suddenly acquired the gift of prophecy. This affair had been rumbling on ever since L’Oréal’s 1983 acquisition, through a subsidiary, of Helena Rubinstein’s Japanese and South American businesses. The boycott committee had told L’Oréal then that it was taking a risk, since the Rubinstein parent company had strong Zionist ties, but L’Oréal had set its sights on Helena Rubinstein and refused to be put off. On the contrary, the following year, 1984, they discreetly, and via another subsidiary, bought 45 percent of Helena Rubinstein, Inc., from Albi; and that same year, they sold off HR Inc.’s Israeli subsidiary to Israeli nationals in an attempt to head off the boycott threat. In 1985, however, the boycott committee announced that it was still not satisfied. L’Oréal indignantly riposted that it was not the owner of Helena Rubinstein—which indeed it was not. And there matters rested—until 1988.

L’Oréal had two problems. The first was that French law forbade it to deal with the Arab boycott committee. The second was that its ties to Israel, far from being cut, had recently been strengthened.

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.