U.S. cosmetics giant Estée Lauder Companies Inc. (EL) recently completed its previously announced takeover of high-end fragrance brand Editions de Parfums Frédéric Malle to strengthen its fragrance category. However, the terms of the deal have not been disclosed.
Parfums Frédéric Malle, established by reputed perfumer Frederic Malle, offers exclusive, ultra luxury fragrances and home environment products to premium customers. The brand includes 21 fragrances created by 12 master perfumers. These are sold through five stand-alone stores in Paris and New York, as well as through Barneys New York in the United States and Liberty in London.
Parfums Frédéric Malle will be managed by The Estée Lauder Companies’ Group President, John Demsey who also overlooks the operations of brands like Estée Lauder, M·A·C, Tom Ford, Prescriptives, Bobbi Brown, Jo Malone, La Mer, Bumble and bumble, Smashbox and Aramis & Designer Fragrances, Le Labo and RODIN olio lusso.
With the buyout, Estee Lauder not only gained Frédéric Malle’s product portfolio — which perfectly complements Estée Lauder’s prestige brand portfolio — but also its loyal customer base.
Estée Lauder is one of the world's leading manufacturers and marketers of quality skin care, makeup and fragrance and hair care products that are sold in over 150 countries. The company has been consistently driving decent earnings backed by product innovation and strategic initiatives.
Recently the company is making several strategic acquisitions in order to boost its presence in the cosmetics sector.
Moreover, in December, Estée Lauder entered into an agreement to take over skin care brand GLAMGLOW to enhance the prestige skin care portfolio. Although terms of the deal were not disclosed, Estée Lauder expressed its desire to close the deal this month (Read More: Estee Lauder to Buy GLAMGLOW, Boost Skin Care Portfolio).
In October, last year, Estee Lauder entered into a definitive agreement to take over high-end fragrance and lifestyle brand Le Labo (The Lab) in an attempt to boost its fragrance portfolio (Read More: Estee Lauder to Boost Fragrance Portfolio with Le Labo).
Stocks to Consider
Estée Lauder currently carries a Zacks Rank #3 (Hold). Better-ranked stocks in the broader retail sector are Limited Brands Inc. (LB), Foot Locker Inc. (FL) and Citi Trends Inc. (CTRN). All these stocks carry a Zacks Rank #2 (Buy).
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