Estée Lauder Acquires Tom Ford Luxury Fashion Brand

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The luxury fashion firm Tom Ford is being acquired by The Estée Lauder Cos. in a deal valued at $2.8 billion. This is the largest deal to date in 2022 for the luxury market. As a part of the deal, Marcolin S.p.A. and Ermenegildo Zegna Group have set foot in a long-term licensing agreement for Tom Ford eyewear and Tom Ford fashion. The exchange is expected to close in the first quarter of 2023, pending regulatory approval. 

In 2006, Estée Lauder presented its Tom Ford Beauty line, which increased the company’s sales. The beauty line is forecasted to bring in net sales of $1 billion in the upcoming few years. Estée Lauder’s enduring licensing agreement with Tom Ford’s beauty business includes fragrance, skincare, and cosmetics. Under this new purchase, Tom Ford’s best-selling scents, such as Black Orchid and Tuscan Leather, will continue to thrive. Estée Lauder will expand their portfolio to new markets as they welcome apparel.  

While shares are down nearly 40% this year due to Asia’s strict pandemic policies, Estée Lauder will pay $2.3 billion through a mix of cash, debt, and $300 million in deferred payments. The Tom Ford Eyewear license owner, Marcolin, will pay $250 million to Estée Lauder at the deal close. Terms of the agreement state that Tom Ford will remain the creative architect behind the company’s genius through the end of 2023. 

Fabrizio Freda, president and CEO of Estée Lauder stated, “This strategic acquisition will unlock new opportunities and fortify our growth plans for Tom Ford Beauty. 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.” Navigating luxury industries amidst pandemic protocols and transitional consumer behaviors has cultivated a new course of action for business expansion and growth. This acquisition highlights the endless potential the fragrance industry harnesses. 

The post Estée Lauder Acquires Tom Ford Luxury Fashion Brand appeared first on The Source.

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