August 15^th, Magic Holdings International Ltd. issued an announcement on the Hong Kong Stock Exchange, saying that Magic Holdings International has made an agreement with L'Oreal. The L'Oreal Group will pay $6.5 billion Hong Kong dollars ($843 million USD) in cash to acquire China's Magic Holdings International.

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The L'Oreal Group is the world's largest cosmetics company. With its registered office in Paris and headquarter in the Paris suburb of Clichy, France, it has developed activities in the field of cosmetics for more than a hundred years. Concentrating on hair color, skin care, sun protection, make-up, perfumes and hair care, the company is active in the dermatological, tissue engineering and pharmaceutical fields and is the top nanotechnology patent-holder in the United States.

Magic Holdings is a skincare brand enterprise, which concerns female beauty and health. It is a Hong Kong-listed company with its star products of various cosmetic facial masks. In 2012, the revenue of Magic Holdings was nearly $199 million.

According to the agreement between Magic and L'Oreal, after the trading is complete, Magic Holdings International Ltd. will delist from the Hong Kong Stock Exchange. Yesterday, share price of Magic surged 19.01% to $6.010 Hong Kong dollars per share.

Why does L'Oreal acquire Magic Holdings? According to insiders estimate, the acquisition will give L'Oreal the top-selling facial mask brand in China, where beauty and personal care product sales will expand 8 percent to $34 billion in 2013.

Cosmetic facial mask is one of the fastest-growing areas in Chinese cosmetics market. Therefore, the prospect of this ground is vast. China is a 1.3 billion-population market and personal care is growing. Based on the financial report of Magic Holdings in 2012, the facial-mask industry leader accounted for 26.4 percent share in Chinese market, increasing 29% comparing to 2011. It indicates Magic Holdings has outstanding potential in China.