Estee Lauder to buy Tom Ford in a deal valued at $2.8B
Hobby Lobby founder and CEO David Green joined ‘Varney & Co.,’ Monday, to explain his decision to give away ownership of his company and, instead, “choose God.”
Luxury cosmetics firm Estée Lauder is acquiring designer fashion house Tom Ford in a deal worth $2.8 billion, the company has announced.
The deal would be Estée Lauder’s biggest acquisition to date.
As part of the deal announced Tuesday, Ermenegildo Zegna Group and Marcolin S.p.A. will enter long-term license agreements for Tom Ford fashion and Tom Ford eyewear, respectively.
AMAZON’S NEW TELEHEALTH SERVICE TO OFFER CARE FOR COMMON CONDITIONS
FILE PHOTO: Designer Tom Ford arrives at the In America: An Anthology of Fashion themed Met Gala at the Metropolitan Museum of Art in New York City, New York, U.S., May 2, 2022. REUTERS/Andrew Kelly (Reuters/Andrew Kelly / Reuters Photos)
While Estée Lauder said the deal values the total enterprise at $2.8 billion, the New York-based beauty company is expected to pay roughly $2.3 billion, after a $250 million payment from Italian eyewear manufacturer Marcolin SpA.
The purchase, subject to regulatory approvals, is slated to close in the first half of 2023.
ESTEE LAUDER IN TALK TO BUY LUXURY BRAND TOM FORD
In a joint statement with Estée Lauder, Tom Ford said, “I could not be happier with this acquisition”.
He said the Estée Lauder companies had been “an extraordinary partner from the first day of my creation of the company, and I am thrilled to see them become the luxury stewards in this next chapter of the Tom Ford brand.”
Tom Ford himself will remain in his current position as creative director until 2023 at least, the companies announced. Domenico De Sole, chairman of Tom Ford International, will stay on as a consultant until that same time.
An Estée Lauder cosmetics counter is seen in Los Angeles, California, U.S. (Reuters/Lucy Nicholson / Reuters)
Since 2006, the US beauty firm has licenses Tom Ford fragrances and cosmetics.
In Estée Lauder’s fiscal year that ended June 30, the brand’s net sales grew nearly 25% compared to the prior year. The beauty company said that in the next few years it expects the beauty line to bring in net sales of $1 billion.
Estée Lauder said the acquisition would “unlock new opportunities”.
“This strategic acquisition will unlock new opportunities and fortify our growth plans for Tom Ford Beauty,” said Fabrizio Freda, president and CEO of Estée Lauder in a statement. “It will also further help to propel our momentum in the promising category of luxury beauty for the long-term, while reaffirming our commitment to being the leading pure player in global prestige beauty.”
CLICK HERE TO READ MORE ON FOX BUSINESS
Estée Lauder said it aims to finance the acquisition through a combination of cash, debt and $300 million in deferred payments to sellers that become due beginning in July 2025.
The Associate Press contributed to this file.
Read More: Estee Lauder to buy Tom Ford in a deal valued at $2.8B