Strategic Alliance Announced Between The L’Oréal Group And Shu Uemura Cosmetics Inc. Investors / Shareholders

PARIS November 24th , 2000 - The L'Oréal Group and Mr. Shu Uemura have signed an agreement whereby L'Oréal's Japanese subsidiary, Nihon L'Oréal K.K. will acquire a 35% participation in Shu Uemura Cosmetics Inc. This company will in turn transfer to the L'Oréal Group its international business, including the rights to the brand outside of Japan.

For the Shu Uemura brand this new agreement fulfils two objects, on the one hand gaining access to L'Oréal's resources to reinforce its already strong position in Japan and on the other to be able to rely on the L'Oréal group's R&D and marketing strength and its world-wide network to establish it among the world's leading cosmetic brands.

For the L'Oréal group, this agreement will further strengthen its growing position in Japan, particularly in the selective department store distribution, and provide it with a modern, highly creative brand in its global portfolio, its first from Japan.

Shu Uemura Cosmetics, which carries the name of its founder, a pioneer not only in the art of make-up but also in the development of advanced skin cleansing and treatment products, has become one of the most celebrated cosmetics brands in Japan. It is sold through more than 100 department store counters and its own boutiques, and other lines are found in leading beauty salons across the country. Outside of Japan, it is already sold in 25 countries through about 100 department stores or exclusive boutiques, with 75% of these overseas sales coming in South-East Asia. Shu Uemura's sales in 1999 grew by 16% to ¥ 13.5 billion. (Euros 145 million)

L'Oréal has been present in Japan for more than 35 years and created its subsidiary Nihon L'Oréal in 1996 to group all the cosmetic brands of the group under a single corporate banner. In addition to the L'Oréal brand in both Salon and Consumer distributions, the company markets Lancôme, Helena Rubinstein, Biotherm, Ralph Lauren, Giorgio Armani and Lanvin fragrances, Redken and since 1999, Maybelline. Its sales in 1999 totalled ¥35.6 billion. (Euros 385 millions)

Shu Uemura will remain an authentic Japanese brand, with its international development being conceived and piloted from Tokyo. As has been the case with the L'Oréal group's American brands, which have retained their full USA identity and integrity, the Shu Uemura brand will retain all its Japanese creativity and flair and indeed help the group in its efforts to establish a third creative centre in Tokyo, alongside Paris and New York.