Luxury cosmetics company Estée Lauder is acquiring designer fashion house Tom Ford in a deal valued at $2.8 billion, the company announced. The deal would be Estée Lauder’s biggest acquisition to date. As part of the deal announced on Tuesday, Ermenegildo Zegna Group and Marcolin SpA will enter into long-term license agreements for Tom Ford fashion and Tom Ford eyewear, respectively. AMAZON’S NEW PHONE SERVICE OFFERS CARE FOR COMMON CONDITIONS FILE PHOTO: Designer Tom Ford arrives at the Met Gala themed In America: An Anthology of Fashion at the Metropolitan Museum of Art in New York, New York, U.S., May 2, 2022. REUTERS/Andrew Kelly (Reuters/Andrew Kelly/Reuters Photos ) While Estée Lauder said the deal values the overall business at $2.8 billion, the New York-based beauty company is expected to pay about $2.3 billion, following a $250 million payment by Italian eyewear maker Marcolin S.p.A. The purchase, subject to regulatory approvals, is expected to close in the first half of 2023. ESTEE LAUDER IN TALKS TO BUY TOM FORD LUXURY BRAND In a joint statement with Estée Lauder, Tom Ford said: “I couldn’t be happier with this acquisition.” He said the Estée Lauder Companies have been “a great partner since day one of my creation of the company, and I’m excited to see them become the luxury managers in this next chapter of the Tom Ford brand.” Tom Ford himself will remain in his current role as creative director until at least 2023, the companies announced. Domenico De Sole, president of Tom Ford International, will remain as a consultant until then. An Estée Lauder cosmetics counter is seen in Los Angeles, California, US (Reuters/Lucy Nicholson / Reuters) Since 2006, the American beauty company has licensed Tom Ford perfumes and cosmetics. In Estée Lauder’s fiscal year ended June 30, the brand’s net sales rose nearly 25% compared to the previous 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 strengthen our growth plans for Tom Ford Beauty,” said Fabrizio Freda, chairman and CEO of Estée Lauder in a statement. “It will also help further drive our momentum in the promising luxury beauty category over the long term, while reaffirming our commitment to be the leading pure player in global prestige beauty.” CLICK HERE TO READ MORE ABOUT FOX BUSINESS Estée Lauder said it aims to finance the acquisition through a combination of cash, debt and $300 million in deferred payments to vendors that become due from July 2025. The Associate Press contributed to this file.
