Estee Lauder buys fashion brand Tom Ford in a $2.8 billion deal | Jobi Cool


Nov 15 (Reuters) – Estee Lauder Cos Inc ( EL.N ) said on Tuesday it struck a deal to buy U.S. fashion brand Tom Ford for $2.8 billion in what would be its largest-ever acquisition.

The deal will help Estee expand its luxury offering at a time when demand for high-end apparel and accessories remains buoyant despite record US inflation.

Founded by fashion designer Tom Ford in 2005, the luxury brand is known for menswear, but also counts womenswear, handbags, cosmetics and perfumes as part of its product line.

The deal is the latest in a series of acquisitions by Estee Lauder, including taking full control of Deciem, the owner of conventional skin care brands, last year for about $1 billion. (https://reut.rs/3tqhWrK)

By Tuesday’s close, Estee’s stock had fallen 17% since the Wall Street Journal first reported talks with Tom Ford in August.

Tom Ford had entered into exclusive talks with Estee Lauder last week, beating off rival bids from companies including Gucci owner Kering SA ( PRTP.PA ), the Financial Times reported on Friday.

Shares of Estee Lauder, which already licenses Tom Ford fragrances and cosmetics, were slightly lower in extended trading.

Estee expects to finance the transaction with a combination of cash, debt and $300 million in deferred payments to vendors due in July 2025, the company said.

Reporting by Granth Vanaik and Manya Saini in Bengaluru; Editing by Shailesh Kuber and Maju Samuel

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