Estée Lauder and Charlotte Tilbury owner walk away from merger talks
Cosmetics giant Estée Lauder has abandoned talks with the Spanish owner of Charlotte Tilbury over a merger which would have created a $40bn fashion powerhouse.
Talks between the US cosmetics giant and Spanish beauty giant Puig ended on Thursday despite hopes that the merger could have helped both brands to compete with rival L’Oreal.
Estée Lauder said on Thursday that “the parties have terminated discussions regarding a potential business combination”.
Estée Lauder’s shares jumped by 11.5 per cent on the NYSE following news the talks had broken down, while Spanish-listed Puig is down more than 13 per cent on Friday’s early trading.
The US firm is one of the world’s biggest makeup manufacturers and its portfolio includes Clinique, Bobbi Brown and Tom Ford Beauty.
Power struggle ended talks
Puig, which floated in Madrid in 2024, owns brands including Charlotte Tilbury, Jean Paul Gaultier, Carolina Herrera and Dries van Noten.
The discussions failed over makeup artist Charlotte Tilbury’s demands over her own compensation as part of the deal, Bloomberg has reported.
Tilbury is one of the UK’s richest beauty entrepreneurs, having amassed a £350m fortune. She worked as a makeup artist for 20 years before founding her own brand in 2013.
Other sticking points preventing a deal included a struggle between the families which control the two companies over who would hold the balance of power on the board, according to the Financial Times.
It first emerged in March that the two beauty giants were in discussions over a merger.
‘Re-iterating confidence in our brands’
Stéphanie de La Faverie, Estée Lauder’s chief executive, said the firm was “grateful for the conversations we have had with Puig.
“Today, we are re-iterating our confidence in the power of our incredible brands, our talented teams and our strength as a standalone company,” she added.
José Manuel Albesa, the chief executive of Puig, said on Thursday that the company “appreciate[d] the meaningful conversations”.
He said: “This decision does not alter our strategic roadmap. We will continue to take a highly selective and value-focused approach to mergers and acquisitions in order to further complement our portfolio.”
Puig has pursued an aggressive acquisition strategy in recent years, having snapped up 11 fragrance and fashion brands between 2011 and 2024.
The Spanish firm’s initial public offering in 2024 valued the firm at close to €14bn. The Puig family retained more than 90 per cent of voting shares following the float.
Estée Lauder was founded by the eponymous American businesswoman and her husband in 1946, and the family retains around 80 per cent of voting power.