Yesterday, June 2, Stéphane de La Faverie, CEO of Estée Lauder Companies, publicly confirmed that talks between the Puig and Estée Lauder groups had broken down due to a disagreement over the deal’s valuation.
At a conference organized in Paris by Deutsche Bank, Stéphane de La Faverie, CEO of Estée Lauder, stated: “The price wasn’t right,” putting an end to the speculation that had been swirling in the beauty industry for several weeks.
Had the deal been finalized, the merger would have created one of the world’s most powerful premium beauty groups, capable of directly competing with industry giant L’Oréal. According to market estimates, the combined entity would have generated approximately €17.5 billion in annual revenue and been valued at close to $40 billion.
Two Groups on Opposite Trajectories
Yet the two companies came to the negotiating table with complementary profiles. Puig, owner of brands including Carolina Herrera, Rabanne, Jean Paul Gaultier, Byredo, and Charlotte Tilbury, posted record revenue of €5.04 billion in 2025, up 5.3% from the previous year, with net profit of nearly €600 million. Listed on the stock exchange in 2024, the Catalan group boasts solid profitability.
In contrast, Estée Lauder recorded €12.48 billion in sales for its 2025 fiscal year. But the American group is undergoing a complex restructuring process. After several years marked by a slowdown in the Chinese market and difficulties in travel retail, the company has launched a sweeping transformation plan aimed at achieving up to $1.2 billion in annual savings and cutting several thousand jobs.
While price appears to be the official reason for the breakup today, several sources close to the matter also cite governance differences between the families controlling the two groups, as well as sensitive discussions surrounding Charlotte Tilbury, founder of the eponymous brand majority-owned by Puig but in which she remains a minority shareholder. These issues reportedly made negotiations more difficult and complicated the finalization of the deal.
“This decision does not alter our strategic roadmap. We continue to build on our strengths in premium beauty,” assured Jose Manuel Albesa, Puig’s CEO, in a statement released on May 21.
For investors, the reaction was immediate. Upon the announcement that the deal was being abandoned, Estée Lauder’s stock rose, while Puig’s fell sharply—a sign that the markets were primarily concerned that the American group could be further weakened by the costs and consequences of a transaction of such magnitude.
Key Points:
• Merger talks between Puig and Estée Lauder collapsed due to disagreements over the valuation of the deal, bringing weeks of industry speculation to an end.
• Had the transaction been completed, it would have created one of the world’s largest premium beauty groups, with an estimated €17.5 billion in annual revenue and a valuation close to $40 billion.
• Beyond the pricing dispute, governance differences between the controlling families and sensitive discussions surrounding Charlotte Tilbury are also believed to have contributed to the breakdown of negotiations.
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