The American group Estée Lauder has intensified its movements to take control of the Spanish Puig. According to Expansión and various market sources report, the American company is studying launching a public acquisition offer (OPA) on Puig's outstanding shares, with a range of between 18 and 19 euros per share.
A transformational operation for the sector
The potential takeover bid is framed within the open negotiations that were made public since March between both companies to explore a business combination that would give rise to the largest global selective beauty group. The integration would allow to bring together under the same perimeter brands such as Tom Ford, Carolina Herrera, Rabanne or Clinique, consolidating a highly complementary portfolio between fragrances, skincare and makeup.
Estée Lauder's interest responds both to a strategic logic and is to strengthen its positioning in fragrances, where Puig is especially strong. Estée Lauder has the need to reactivate its growth in a context of weakness in key markets like China.
The operation presents a high financial complexity. On the one hand, Estée Lauder has commissioned JPMorgan Chase to structure a financing package of around 5,000 million euros to face the purchase of shares in the market and refinance Puig's debt.
On the other hand, the final design of the transaction could combine a share swap that would be key to maintaining the weight of the Puig family, with a cash component aimed at minority shareholders.
Stock market pressure and increased cost of the operation
One of the factors conditioning the timing is Puig's stock market performance. Since the conversations became known, the Catalan company has gained around 1,700 million euros in capitalization, which significantly increases the bill for Estée Lauder. Nevertheless, the share price remains below its IPO price in 2024, which explains why the proposed tender offer range is at levels moderately higher than the current market, but still at a discount compared to its stock market debut.
Corporate governance: key to close the deal
Beyond the price, negotiations remain open on critical aspects such as corporate governance and the distribution of power in the future entity. The Puig family, which controls more than 70% of the capital and close to 93% of the voting rights, aims to maintain a relevant position in the resulting group. In parallel, financial advisors have proposed alternatives such as an eventual dual listing of Estée Lauder in Spain to optimize the operation's structure and reduce its cost, which evidences the sophistication of the process.