Estée Lauder Agrees to Buy Tom Ford Brand in $2.8 Billion Deal That Could Expand Lauder’s Branded Collection
Estée Lauder, the beauty company and cosmetics house based in Beverly Hills, Calif., announced Wednesday it has signed a deal worth at least $2.8 billion to buy Tom Ford Cosmetics, an Australian company that is the world’s second-largest beauty brand.
The deal will give Lauder the world’s largest portfolio of private-label brands and a significant piece of cosmetics industry growth in the U.S.
Estée Lauder, based in Beverly Hills, Calif., has a diverse array of brands that encompass more than 75 lines in multiple product categories ranging from skin and hair care to cosmetics. Estée Lauder has a strong presence in China with products for women’s skin care and beauty. The company has a large presence in Japan, Taiwan and South Korea with products for women’s skin care and home products for families.
“Estée Lauder is one of the world’s most iconic and respected luxury brands, with a diverse portfolio of leading cosmetics and skin care brands for men and women,” Lauder Cosmetics President and CEO, Richard J. Lacayo, said. He added that “the global beauty category is one of the most dynamic and challenging businesses in the world, and we are very excited about our strategic partnership with Estrada Beauty Brands, the world’s leading global beauty leader.”
Estée Lauder will maintain ownership of its Estée Lauder Beauty, Beauty Blends and Nars product lines that are produced at its global manufacturing facilities in California and Japan.
The brand’s Estée Lauder Asia brand will maintain full ownership. The deal, which closed in Toronto on Wednesday, is worth $2.8 billion, subject to customary closing and restructuring costs, and includes up to 5 percent in cash and 3.9 million shares of Estée Lauder from existing Lauder shareholders.
“Since our founding, Estée Lauder has been committed to making inroads in China,” said Steven Delfin, general manager of Estée Lauder Asia, in a statement