Ask AI or just Google it? Google makes a big change to a little search box
Google's major update: AI-generated answers for searches in the U.S.
NPR Topics: News1 min read
Estée Lauder ends merger talks with Gaultier owner Puig
TL;DR
Estée Lauder has ended merger talks with Puig, the owner of Jean Paul Gaultier, after failing to agree on power distribution in the potential $40bn deal. The discussions, which began in March, could not resolve key issues regarding board seat allocation and control.
Key points
- Estée Lauder ended merger talks with Puig
- Disagreements over power distribution halted the merger
- Proposed merger valued at nearly $40 billion
- Puig owns brands like Jean Paul Gaultier and Charlotte Tilbury
- Discussions began in March but failed to progress
Mentioned in this story
Estée LauderPuig
Jean Paul GaultierCharlotte TilburyCarolina HerreraDries van Noten
The US cosmetics company Estée Lauder has ended merger talks with its Spanish rival Puig to create a fashion and beauty retailer worth almost $40bn (£30bn/€34.5bn) after failing to agree which would hold the balance of power in the combined group.
Estée Lauder is one of the world’s biggest manufacturers of skin care, makeup and fragrances with a portfolio that includes Clinique, Bobbi Brown and Tom Ford Beauty.
Puig, which floated on the Madrid stock market two years ago, owns brands including Jean Paul Gaultier, Charlotte Tilbury, Carolina Herrera and Dries van Noten.
Estée Lauder said on Thursday “the parties have terminated discussions regarding a potential business combination”.
The talks, which were first revealed in March, failed to progress to an agreement on how the final merged entity would be structured. Sticking points included the issue of which of the two families that control the fashion and beauty giants would hold the balance of power and the allocation of board seats, according to the Financial Times.
Bloomberg reported that another bone of contention had been the level of compensation demanded by Tilbury, one of the UK’s richest beauty entrepreneurs.
Stéphane de La Faverie, the chief executive at Estée Lauder, said: “We are 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.”
The talks had not been popular with Estée Lauder investors with its market value falling by about a fifth after they were made public. On Thursday Estée Lauder’s shares climbed by 11.5% in post-market trading as investors welcomed the news they had been terminated.
The Lauder family controls the company, which was founded in 1946, through a dual class voting structure, owning about 38% of shares, but indirectly or directly has more than 80% of voting power.
However, shares in Puig, which had fallen almost 30% since its €13.9bn flotation in 2024, rose 15% when the potential merger was announced. The company’s shares plunged by the same amount after the termination of the talks.
Most of the voting rights remain controlled by the Puig family, which founded the business 110 years ago.
Q&A
Why did Estée Lauder end merger talks with Puig?
Estée Lauder ended the merger talks due to disagreements over the balance of power and board seat allocation in the proposed combined entity.
What brands are owned by Puig?
Puig owns several brands including Jean Paul Gaultier, Charlotte Tilbury, Carolina Herrera, and Dries van Noten.
What was the estimated value of the merger between Estée Lauder and Puig?
The proposed merger between Estée Lauder and Puig was valued at nearly $40 billion.
