The Estée Lauder Cos. acquires Deciem for $1.7 billion

The Estée Lauder Companies, which owns Estée Lauder, MAC Cosmetics and Clinique, among others, has completed its $1.7 billion (£1.33 million) acquisition of Deciem, owner of affordable skincare brand The Ordinary.

The beauty conglomerate first invested in Deciem in 2017, increasing its stake to become majority owner in 2021.

According to a statement by the Estée Lauder Cos., it “recently” exercised its option to purchase the remaining interests in Deciem after a three-year period. The acquisition was completed on 31 May.

Lauder used cash on hand for the purchase, an estimated $860 million (£672 million). The total net investment is approximated to be $1.7 billion (£1.33 million) over the three payments. The statement notes that these amounts are “subject to post-closing adjustments in accordance with the agreement”.

Deciem’s flagship brand, The Ordinary, is in Lauder’s tier of scaling brands, each with net sales between $500 million and $1 billion. 

Backed by Lauder, The Ordinary has expanded its consumer reach globally via launching in key markets such as India, the Middle East and South Africa. 

Over the last three years, The Ordinary has successfully increased innovation as a percentage of sales, driven by the highly-sought-after launches of Multi-Peptide Lash and Brow Serum, Multi-Peptide Eye Serum, and Soothing & Barrier Support Serum, demonstrating the brand’s continued focus on developing game-changing products.

The Ordinary was founded in Canada in 2013, by Iranian-Canadian entrepreneur Brandon Troaxe, and launched as a brand subsidiary of Deciem, co-founded by Troaxe.

Fabrizio Freda, President and Chief Executive Officer, Estée Lauder Cos., said: “We are incredibly proud of what Deciem is accomplishing. In our seven years of partnership, Deciem has achieved impressive growth while continuing its core mission of reimagining effective, high-quality skin care for today’s diverse and sophisticated consumers. As a digitally native organisation with a highly engaged following among millennial and Gen Z consumers, Deciem helps to strategically expand our skin care portfolio, and we believe there are many more exciting growth opportunities ahead.”

Nicola Kilner, co-Founder and CEO, Deciem, also commented: "Today The Estée Lauder Companies becomes the forever home of Deciem. Our founder Brandon set out to disrupt the world of beauty, and this thinking has been embraced by ELC over the past seven years of our partnership. Their support, along with the energy of our incredibly talented team, has allowed us to strengthen our operational capabilities and enter new markets, while staying true to our founding values of transparency, quality, and authenticity."