SHANGHAI (AdAgeChina.com) -- L'Oreal Group has consolidated its media planning and buying business?excluding digital media?with WPP's Mindshare, ending what Mindshare claims was the largest advertising pitch ever to take place in China.

The decision is a blow to Publicis Groupe's Optimedia, the main incumbent, but a welcome relief for Mindshare, which lost the entire Unilever account at the end of 2009 in a pitch against Omnicom Group's PHD division.

L'Oreal is one of China's largest and fastest-growing advertisers "and this is the biggest pitch probably ever in China. It's a big comeback for the Mindshare guys," said Bessie Lee, GroupM's CEO, China in Shanghai.

Mindshare claims L'Oreal's media budget in China is $2.5 billion, based on industry source CTR's official figures using rate card prices. Given China's massive media discounts, the French skin care and cosmetics giant probably spends close to $1 billion, not far behind the country's largest advertiser Procter & Gamble.

L'Oreal has come a long way. Back in 2008, Ad Age's annual Top Global Marketers ranking placed L'Oreal in the No. 4 slot, with spending after media discounts of about $333 million. But L'Oreal increased its ad spending by 73.2% that year, followed by massive increases in its media budget in 2009 and 2010, and has likely passed former No. 2 spender Unilever and third-ranked Harbin Pharma Group.

Previously, Mindshare handled about 25% of L'Oreal's media business in China--some TV buying as well as the strategic planning business for L'Oreal's Maybelline brand.

Optimedia, which has worked with L'Oreal in China for seven years, handled the rest of the company's above-the-line media business for TV buying as well as planning for all of L'Oreal's other brands in China, which include L'Oreal Paris, Biotherm, Shu Uemura, Yue Sai, Garnier and Vichy. (Although ZenithOptimedia operates as one agency in many markets, Zenith Media and Optimedia continue to function as separate divisions in China.)

Only the two incumbents, Optimedia and Mindshare, participated in the pitch, which started in early summer 2010. Final presentations were made in mid-October. Publicis-owned Vivaki won a two-year assignment last year to handle L'Oreal's digital business, which is not affected by the pitch.

While P&G's spending may still top L'Oreal?the exact spending by both marketers is impossible to determine given the fragmented nature of China's media industry and level of volume discounts?the U.S. company divides its media business between two agencies, Publicis's Starcom and WPP's Mediacom. Mindshare's L'Oreal win is now regarded as the largest media account handled by a single agency in China.