If you watch the clips about the 10 wealthiest women in the world, on top of the list is a French lady named Francoise Bettencourt Meyers whose family owns shares in the beauty company L’Oreal. The company makes cosmetics for people with the overwhelming majority from women products. If you own shares in a drug store company, you know that cosmetics have large margins and equally important the buyers believe they are getting good value for their money.

In an article by Dave Graham and Dominique Patton of Reuters, L’Oreal announced it is buying 10% of Swiss skin care firm Galderma. L’Oreal is buying into because Galderma is a leader in the booming injectable cosmetics market. The stake of $1.6 billion Swiss francs will be funded through available cash and credit lines.

L’Oreal knows the company well, for it was originally owned 50% by Nestle and 50% by L’Oreal. In 2014 L’Oreal reorganized and sold its stake. The 10% is coming from Sunshine SwissCo AG a group lead by Swedish private equity firm EQT, Abu Dhabi Investment Authority, and Auba Investment Pte. Ltd.

After WW II, the baby boom was created and now those people are senior citizens. With all senior citizens, the skin is less flexible and the beauty industry idealized form says injectable products that can reduce wrinkles such as fillers and neuromodulators which include botox are a must for a portion of those seniors.

L’Oreal CEO Nicholas Hieronimus said about half of Galderma’s revenues come from injectables. The market was worth $10 billion last year.

The penetration rate of these procedures already stands at mid-single digits and it could easily double in the next decade.

The global esthetics market is predicted to grow to $25.9 billion by 2028 from $15.4 billion last year according to Markets-and Markets research.

L’Oreal is positioning their stake in Galderma as strategic to working on research and development for technically the companies are competitors and will remain as strong competitors.

Linking to dividend paying stocks, large companies have access to capital, logistics and product placement but all markets evolve and there are competitors trying to fight their way on the shelves for consumers. The access to capital means all large companies can have strategic positions in companies as they wait till the correct time to buy them and continue to make profits. This time frame can be a luxury for small and medium sized companies but a normal course of action for the large companies.

There are more questions than answers, till the next time – to raising questions.