Estée Lauder Companies’ (ELC) President and CEO Stéphane de La Faverie has revealed the reason why the beauty giant and rival Puig failed to reach a deal to merge their businesses.
ELC and Puig first revealed they were in talks over a potential merger in March, but then announced in March that those discussions had been terminated.
Speaking at the Deutsche Bank Global Consumer Conference in Paris, France, on Tuesday (2 June), de La Faverie said the price was not right to get the deal across the line.
“If we cannot reach the growth and the profitability at the right price point, then that is not an option,” he said.
“And this is why, obviously, this deal did not go through, because it was not at the right price.
According to a recent report, ELC has allegedly received final bids for the rumoured sale of its brands Too Faced, Smashbox and Dr. Jart+.
De La Faverie touched on the company’s portfolio review, though stopped short of elaborating on the brands that may face the chop, or how close they are to being sold.
“Sometimes we have to revisit the portfolio, and we are looking at it,” he said.
“I have been clear that we have hired advisors to look at some of our brands.
“Sometimes brands do not fit [consumer needs anymore], and this is what we are in the process of re-looking at now.”
ELC is also open to adding to its portfolio of brands, which includes make-up brand MAC Cosmetics and fragrance brand Killian Paris.
“I have also been very public that we will be part of the M&A discussion,” he said.
“We have always been part of the M&A conversation.”
He added that wrapping up the company’s ‘Beauty Reimagined’ turnaround plan by the end of the year allows it to “make [a] more transformational deal if we decide to in the future, but again, it has to be at the right price, and it has to make sense within the existing portfolio”.