Estée Lauder remains open to acquisitions after failed Puig talks

Stephane de La Faverie, President and CEO of The Estée Lauder Companies, said that merger discussions with Puig failed to result in a deal because of the price tag, but added that it remains open to acquisitions that make financial sense. 

Estée Lauder and Puig ended negotiations in May regarding a potential combination. Media reports had suggested a combined entity could have been valued at approximately $40 billion, although neither company publicly confirmed that figure.

Speaking at a Deutsche Bank consumer conference in Paris on Tuesday, de La Faverie said the breakdown came down to price.

"If we cannot reach the growth and the profitability at the right price point, then that is not an option. And this is why, obviously, this deal didn't go through, because it was not at the right price," de La Faverie said.

He added that Estée Lauder would continue to evaluate acquisition opportunities.

It comes after Puig Chairman Marc Puig said last week: "We have made it clear that we are not for sale. Any potential combination would have required alignment on three key areas for a merger - governance, business leadership, and economic terms that appropriately value the company and are fair to all stakeholders.

"Ultimately, however, we were unable to reach an overall solution that satisfied both parties, and we therefore agreed that it was best to end the discussions."

Following the end of negotiations, The Estée Lauder Companies said it remains focused on executing its "Beauty Reimagined" strategy, with a goal of generating up to $1.2 billion in annual cost savings.

The news comes as reports recently suggested that Estée Lauder is reviewing strategic options for several brands, including Too Faced, Smashbox and Dr. Jart+.

Some potential buyers were said to have expressed interest in acquiring all three brands, while others have focused on either the makeup or skincare assets separately.