After months of speculation, Estée Lauder Cos. announced Tuesday that it has agreed to buy the Tom Ford brand in a $2.8 billion deal.
The beauty conglomerate will pay approximately $2.3 billion, with the brand’s eyewear partner, Marcolin, paying Estée Lauder $250 million at the closing. Lauder said it would fund the transaction through cash, debt and $300 million in deferred payments, which are due in July 2025. The deal is expected to close in the first half of 2023, pending regulatory approval.
While Estée Lauder will handle Tom Ford’s cosmetics and fragrance businesses, it plans to license the right to make, manufacture and market clothing and accessories. Longtime Tom Ford partner Ermenegildo Zegna Group has forged a long-term agreement with Estée Lauder; while it has worked with the brand on menswear in the past, it will now be responsible for all men’s and women’s fashion, as well as accessories and underwear. Zegna has acquired Tom Ford’s fashion business — which was set up as a separate entity from Tom Ford intellectual property, which was owned solely by Ford — so that there is already an infrastructure in place. Marcolin will continue making the eyewear.
In an unexpected twist, Estée Lauder could only confirm that Ford would remain as the business’ “creative visionary” until the end of 2023. Domenico Del Sol, his longtime business partner — with whom he relaunched Gucci in the 1990s — and current chairman of Tom Ford International, will consult for the brand during the transition.
Ford, who played Freddie Mercury singing “time waits for no one” at his latest runway show, which closed out New York Fashion Week in September, is once again making an exit on his own terms.
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Estée Lauder to Buy Tom Ford in $2.8 Billion Deal
The beauty conglomerate is expected to tap multiple partners to handle the fashion and accessories side of the business, according to a source.
