Estée Lauder and Puig Near Deal to Create $40 Billion Beauty Giant

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4.2.2026

Quick Facts

Estée Lauder and Puig are in advanced talks for a mostly stock merger that could create a $40 billion beauty company
The combined entity would have annual revenues of over $20 billion, making it the second-largest beauty conglomerate after L’Oréal
Family divisions within both companies have delayed agreement, with Jane Lauder opposing the deal despite support from William Lauder

Estée Lauder Cos. and Spain’s Puig Brands SA are advancing in negotiations to combine in a deal that would create one of the world’s largest luxury beauty companies. The transaction could be announced within weeks, according to people familiar with the matter.

The merger would bring together major brands including MAC, Charlotte Tilotte, Le Labo, and Byredo under one roof. Puig’s market cap stands at $10.2 billion while Estée Lauder is valued at $28.7 billion.

A combined entity would generate annual revenues of just over $20 billion, positioning it as the second-largest beauty conglomerate behind L’Oréal’s $44 billion in sales. The deal would also boost global market share in premium fragrance to 15% from Estée Lauder’s current 6%, trailing only L’Oréal’s 16%.

Portfolio Diversification

The merger would significantly diversify both companies’ portfolios. Estée Lauder currently derives 50% of sales from skin care, 29% from makeup, 17% from fragrance, and 4% from hair care. Puig’s business is 72% fragrance and fashion, 17% makeup, and 11% skin care.

Jefferies analysts estimate the combined portfolio would shift to 38% skin care, 34% fragrance, 26% makeup, and 3% hair care.

Financial Challenges

Estée Lauder has struggled with performance issues, losing more than $100 billion in market value over the past four years. The company flagged that U.S. tariffs would impact full-year profitability by $100 million. Shares have fallen 24% year-to-date.

JPMorgan analysts estimate the transaction would require Estée Lauder to raise about $6 billion in new debt, potentially pushing leverage to 4.3 times earnings before synergies. Both Moody’s and S&P Global have assigned negative outlooks to the company.

Family Opposition

Family dynamics complicate the negotiations. William Lauder, who controls 84% of voting power at Estée Lauder, supports the deal. However, his cousin Jane Lauder, the company’s second-largest shareholder and former executive, opposes it.

“While likely financially accretive to Estée Lauder Cos., we believe the potential acquisition of Puig would be dilutive to the company’s Beauty Reimagined turnaround strategy,” wrote Barclays analyst Lauren Lieberman.

The companies have pursued similar deals before, with Estée Lauder making several acquisition attempts over the years. The latest serious push came two years ago before Puig’s public offering.