Cosmetics Giant Estée Lauder to Acquire Fashion Brand Tom Ford for $2.8B

The Estée Lauder Companies (ELC) has agreed to buy fashion house Tom Ford for $2.8 billion, becoming the luxury cosmetic group’s largest acquisition to date.

The deal is expected to be funded through $2.8 billion in cash and debt, and $300 million in deferred payments due in July 2025.

The acquisition includes Tom Ford’s apparel, accessories and eyewear businesses, marking ELC’s first step into fashion.

In addition, luxury Italian firm Zegna, previously an investor in the fashion house, will now license Tom Ford’s clothing business from ELC, while eyewear licensee Marcolin will remain as Tom Ford’s glasses manufacturer.

Tom Ford, founder and CEO of the brand, will continue to serve as its creative visionary until the end of next year.

The acquisition is Estee Lauder’s biggest and latest in a series of transactions, including taking full control of Canadian beauty group Deciem for about $1 billion in 2021.

The deal is also one of the biggest in the luxury fashion and cosmetics industry. In 2018, Capri Holdings bought Italian luxury fashion brand Versace for $2.12 billion. In 2020, VF Corporation, which owns the Vans, Timberland, Altra and The North Face brands, bought streetwear company Supreme for $2.1 billion.