Chinese health firm Renhe weighs bid to gatecrash Body Shop sale
Renhe Pharmacy is said to be considering mounting a late-stage bid to buy The Body Shop from L'Oreal, Sky News understands.
By Mark Kleinman, City Editor
A Chinese healthcare company is weighing an audacious bid to gatecrash the £600m sale of the Body Shop, the British consumer products retailer.
Sky News understands that Renhe Pharmacy Co has made a recent enquiry about participating in the auction of the Body Shop, which has been put up for sale by L'Oreal, the French cosmetics group.
If it proceeds with a bid, Renhe would find itself competing against rival bidders including CVC Capital Partners, the former owner of Formula One motor racing, and Investindustrial, the Italian investor which owns a stake in Aston Martin.
It was unclear on Monday how serious Renhe's intentions are towards the Body Shop, and analysts pointed out that a bid for a British retailer would mark a radical departure from its core strategy.
Sources said the prospect of a Chinese owner of a chain founded upon ethical principles was implausible given the country's dubious record in areas such as the testing of consumer products on animals.
L'Oreal's decision to offload the chain founded by the late Anita Roddick and her husband Gordon in 1976 has sparked a wide array of interest in the business.
Sources close to the process have described the initial price-tag of Euros 1bn (£850m) as "wildly optimistic" and suggested that it may be worth just £600m – or even less, given the complexity associated with carving it out from its owner.
The Body Shop has endured a lacklustre period since L'Oreal bought it for £650m in 2006.
Sales last year fell by about 5% at its 3000 stores in 66 countries around the world.
A number of private equity bidders have been courting executives to lead their offers, with Lazard handling the sale on behalf of L'Oreal.
CVC has enlisted Emmanuel Osti, a former boss of L'Occitane, the French cosmetics brand, and Rob Templeman, who has chaired Debenhams and led a string of other British retailers, including Homebase.
Renhe could not be reached for comment.