Estee Lauder beats Gucci in race to buy Tom Ford for USD 2.8 billion

By Garima Soni  | Date: 2022-11-16

Estee Lauder beats Gucci in race to buy Tom Ford for USD 2.8 billion

Luxury cosmetics company Estee Lauder has reportedly announced the acquisition of designer fashion house Tom Ford for USD 2.8 billion. Notably, this transaction would be Estee Lauders largest in its history.

The US beauty company, which already licenses Tom Ford cosmetics and fragrances, secured the deal by outbidding Gucci's owner Kering S.A.

Estee Lauder asserted that the deal would open innovative prospects and Ford mentioned that it is the most suitable housing for his brand. In a joint statement, both juggernauts expressed their happiness at the transaction.

It is worth mentioning that Tom Ford, although approaching the takeover cautiously, will maintain his present role as creative director at least until 2023.

However, the questions that now remain are to see what happens when Tom Ford retires and becomes a billionaire in 2023, whether his name will still be worth USD 2.8 billion, and will Estee Lauder be capable of selling his goods while he is gone, or will she be forsaken?

Interestingly, the agreement takes place at a time when economists predict that the market for luxury products will expand globally especially when China is progressively removing coronavirus prohibitions, enabling the sector's high-demand clientele to gradually resume pre-pandemic buying.

Sources relay that the Chinese consumers accounted for 35% of global demand for luxury goods before the pandemic.

Global researchers stated that despite a drop in the state of the world economy, the global luxury industry is predicted to expand by 21% and reach USD 1.45 trillion in 2022.  Statistics show that the market for clothing, luggage, and cosmetics is anticipated to reach USD 366 billion by the end of 2022, representing a projected 22% increase over the previous year.

The Council of Fashion Designers of America is now led by Tom Ford, who initially established his company in 2005. In the 1990s and early 2000s, he served as the creative director at Gucci and Yves Saint Laurent.

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Garima Soni

Garima Soni

Despite starting her career in science, Garima always had a zeal for writing. She started out her writer journey as a freelancer which eventually turned into a full-time job. Now as an upcoming MBA professional, Garima pens down articles for BonafideNews and several o...

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