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L'Oreal : Notre Dame Reconstruction Funds Roll In After Fire -- 3rd Update

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04/16/2019 | 04:23pm EDT

By Cristina Roca, Mischa Frankl-Duval and Paul J. Davies

A flood of pledges from France's richest people will help pay to reconstruct Notre Dame Cathedral, whose structure was likely uninsured, though the valuable collection of art and objects inside may have some coverage.

By late Tuesday, donors had promised more than EUR700 million ($790 million) for the reconstruction of the fire-damaged Parisian landmark. French officials are still assessing the damage to the cathedral and its contents. Some paintings and priceless artifacts were removed for safety.

Donations from the country's business elite began early Tuesday. François-Henri Pinault, who controls fashion group Kering SA, said his family would give EUR100 million to the reconstruction fund. Kering's luxury brands include Gucci and Alexander McQueen.

His longtime rival and France's richest person, Bernard Arnault, who heads LVMH Moët Hennessy Louis Vuitton SE, said his family and the luxury-goods company it controls would contribute EUR200 million. LVMH also offered the skills of "all of its teams -- including creative, architectural and financial specialists" to help with the reconstruction and fundraising.

L'Oréal SA said the company, the Bettencourt Meyers family -- the biggest shareholder in the cosmetics group -- and the Bettencourt Schueller Foundation would donate EUR200 million in total. French oil giant Total SA will donate EUR100 million, according to a tweet by its chairman and chief executive, Patrick Pouyanné. In the U.S., private-equity tycoon Henry Kravis and his wife, Marie-Josée Kravis, offered $10 million.

In France, as in other countries, making charitable donations can reduce the amount of tax individuals or companies owe.

Sylvain Charlois, chief executive of oak grower Groupe Charlois, told the FranceInfo radio station that the reconstruction would take years or even decades and require millions of cubic meters of wood. He offered to provide wood, saying he would start sourcing the best oak trees and setting aside the best specimens.

Public money has also been pledged. The city of Paris said it would give EUR50 million. The regional government said it would provide EUR10 million.

"In 2024, Paris will host the world for the Olympic and Paralympic Games. We need to do everything we can so that Notre Dame Cathedral is returned to all its splendor for this occasion," said Paris Mayor Anne Hidalgo.

The donations will be needed as there is likely no insurance cover for the cathedral itself, which is owned by the French government that tends not to buy cover for its properties, according to insurance experts.

Robert Read, an underwriter who heads the art and private client division of London-based insurer Hiscox, estimated that it will take at least 15 years and more than EUR1 billion to renovate the space. He based his estimates in part on renovations planned for London's Houses of Parliament. "It's going to be a monster job," he added.

When it comes to the contents -- including the pews, drapes, artworks and religious artifacts -- there is some insurance coverage, but it remains to be seen how much and for what. A main insurer used by the Catholic church in France is Mutuelle Saint-Christophe, a mutual company that provides priests and the faithful with health-care and auto insurance, as well as covers property belonging to the church.

"It's impossible for us to tell you what's been affected, almost certainly some of the furniture will have been affected, it's a bit early to tell what was covered and what wasn't," said Philippe Duvignac, communications director at the insurer. "At this point, it's very premature to give you any accurate figure about the value of the loss," Mr. Duvignac said.

He said Mutuelle Saint-Christophe doesn't yet know what was in Notre Dame that belonged to the diocese that the firm covers. Some valuable items may have belonged to organizations other than the diocese, such as the government or religious orders, which would have responsibility for their own insurance.

Another insurer with potential exposure is AXA France, the domestic business of Paris-based AXA SA. The company said that it insured two of the contractors working on projects in the cathedral and that its specialist art division was involved in insuring certain artifacts. But the exposure won't be known until the investigations are finished. "We must now be patient and let their specialists work," the company said.

Linda Selvin, executive director of the Appraisers Association of America, said it is too early to gauge the value of whatever might be lost because much will depend on how successfully these artifacts might be conserved or restored -- a process that could take years.

On Tuesday, some gilded candelabra, red-velvet chairs, kneeling benches and a few shrines were shuttled from the cathedral to the Louvre Museum's conservation lab, where experts will assess their condition and recommend measures for restoring them.

Kelly Crow and Denise Roland contributed to this article.

Write to Cristina Roca at Cristina.Roca@dowjones.com, Mischa Frankl-Duval at Mischa.Frankl-Duval@wsj.com and Paul J. Davies at paul.davies@wsj.com

Stocks mentioned in the article
ChangeLast1st jan.
L'OREAL SA (ADR) End-of-day quote.
L'ORÉAL -1.15% 240.8 Real-time Quote.21.07%
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Financials (€)
Sales 2019 29 222 M
EBIT 2019 5 449 M
Net income 2019 4 323 M
Finance 2019 4 385 M
Yield 2019 1,73%
P/E ratio 2019 31,59
P/E ratio 2020 29,43
EV / Sales 2019 4,53x
EV / Sales 2020 4,24x
Capitalization 137 B
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