Nestlé, the Swiss food group, reiterated on Thursday that it would be able to sell its 31 per cent stake in L’Oréal, the cosmetics company, when its lock-up agreement with France’s Bettencourt family expires at the end of the month but said it was in no hurry to do so.

A joint statement, released after market close in Paris on Thursday, said: “The Bettencourt family and the Nestlé company will continue on acting in concert towards the L’Oréal company beyond 29 April 2009.”

One analyst said the immediate market reaction could be negative for L’Oréal, which trades at a premium to Nestlé, partly on takover hopes.

The five-year agreement between the Bettencourt family and Nestlé expires on April 29. Under the terms of that agreement, Nestlé cannot raise its holding during the lifetime of Liliane Bettencourt, daughter of L’Oréal’s founder.

Mrs Bettencourt is France’s richest woman, thanks to her 31.78 per cent holding in the cosmetics group.

While the provision prohibiting Nestlé and the Bettencourt family from selling their L’Oréal stakes expires on April 29, the rest of the agreement remains intact, Nestlé said on Thursday.

The agreement includes a mutual right of first refusal on their holdings. It also allows for the two sides either to tender their shares, or make a counter offer, should L’Oréal receive an offer from a third party.

”Both parties are able to sell their stakes if they wish to,” Nestlé said, adding: ”We are not under any pressure to do anything at the time being. We will continue to take a long term view.”

One analyst said: “The statement suggests the status quo will continue and the two companies will keep working together for the time being. Nestlé doesn’t need cash and has very little to gain from acquiring L’Oréal.”

Speculation about Nestlé’s eventual intention regarding its L’Oréal stake has been rife.

While analysts initially thought Nestlé a likely buyer for L’Oréal, most now believe Nestlé is more likely to sell its stake than to raise it, as it focuses on operational excellence and avoids big take-overs. Moreover, L’Oréal has become less attractive in the downturn.

“We expect the saga to continue,” said one analyst.

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