* CEO says no plans to sell Sanofi stake in short term
* Repeats tackling second half with confidence
* Shares rise over 10 percent after results beat forecasts
* L'Oreal chief jokes over Sanofi's share price
(Adds detail, background)
By Nina Sovich and James Regan
PARIS, Aug 26 (Reuters) - The head of L'Oreal, a big shareholder in French drugmaker Sanofi-Aventis, expressed discontent with Sanofi's flagging share price on Thursday, as it embarks on a multi-billion-dollar takeover.
Sanofi wants to buy Genzyme, one of the world's biggest biotech companies and a leading maker of drugs for rare diseases, sources familiar with the situation have said.
L'Oreal and fellow Sanofi shareholder Total do not want Sanofi to pay too much and are not convinced it is the best fit, however, bankers have told Reuters.
"We are a happy investor, a loyal investor. (We) would be happier if the (share) price was higher," Chief Executive Jean-Paul Agon told an analyst briefing on Thursday, eliciting laughter from the crowd, after L'Oreal posted forecast-beating results.
Concerns about where Sanofi will find new sales as some of its drugs lose patent protection have weighed on its shares, which have fallen 19 percent this year. Analysts expect L'Oreal, Sanofi's top shareholder, will sell the stake if it needs to finance a major acquisition itself.
Agon said there were "no plans for the short term" for the 9 percent stake, which is worth about 5.3 billion euros ($6.7 billion), repeating that it was a financial investment and not a strategic one. He would not comment directly on Genzyme.
Sanofi's top two shareholders, L'Oreal and Total, will have a key say in any acquisitions plans, with a strong presence on the group's board.
Of Sanofi's 13 board members, one currently has a key position at oil major Total, and one is a former employee.
L'Oreal is represented on the Sanofi board by two executives, finance chief Christian Mulliez and former CEO and current chairman Lindsay Owen-Jones.
L'Oreal and Total, which together own 15 percent of Sanofi, are both looking to draw down their stakes, despite their strong presence in the governance of the drug company.
SHARES JUMP
Sanofi has offered to buy Genzyme for $69 a share, according to sources familiar with the situation, valuing the company at about $18.4 billion.
Genzyme is looking for a figure of at least $80 and wants an offer of $75 before it will even open its books to the company, people familiar with the situation say.
L'Oreal shares rose as much as 10 percent to their highest level in a month earlier on Thursday after it beat profit forecasts for the first half.
The company, which sells Garnier shampoo and Vichy facial creams, expects to outperform the global cosmetics market this year, Agon said, adding that the market would grow around 4 percent in 2011.
"A lot of people thought the market would collapse ... But cosmetics consumption has held up pretty well. People are not willing to give up cosmetics," he said.
New markets, such as in Africa and Asia, saw 9.5 percent growth in the first half, L'Oreal said.
The CEO added that the U.S. mass market was flat and there was "still no real economic recovery at the moment in the United States".
L'Oreal said late on Wednesday an improvement in manufacturing costs, inventory and distribution cost reduction, and a higher portion of sales of more expensive products helped to lift profit.
It reiterated that it was confident about the second half, though it gave no full-year forecasts. ($1=.7874 Euro) (Writing by James Regan; Editing by Jon Loades-Carter and Will Waterman)