Puig: The group that dreamed of becoming LVMH, yet may disappear under Estée Lauder's shadow

Madrid – Everyone has a price. This stark premise lies at the core of the current negotiations for a “potential” merger between the US group The Estée Lauder Companies and Spain’s Puig. The deal, should it materialise at the right valuation, could effectively subsume Puig’s 112-year history.

Founded in 1914 in Barcelona by Antonio Puig Castelló as Antonio Puig, the company began in perfumery before quickly diversifying into makeup with the 1922 launch of “Milady,” Spain’s first lipstick. Early partnerships—such as with the German Mülhens family, makers of 4711 eau de cologne—and launches like “Agua Lavanda Puig” in 1940 helped establish Puig as a leading beauty company in Spain, then dominated by Perfumería Gal, Parera and Myrurgia.

This position was reinforced through infrastructure investments, including a new fragrance factory and headquarters in Barcelona, and through licensing agreements such as Nina Ricci. The latter led to the 1948 launch of L’Air du Temps, a milestone that highlighted Puig’s international potential. That trajectory accelerated after the second generation—Antonio, Mariano, José María and Enrique Puig Planas—took over in 1950.

From the 1960s onward, Puig expanded internationally, opening offices in the US (1962), the UK (1972) and Panama (1979), and building a production facility in Chartres, France, in 1976 (sold in 2025). At the same time, it strengthened its portfolio with products such as Moana (1966) and fragrances including Agua Brava (1968), Azur de Puig (1969), Estivalia (1973) and Quorum (1982).

A key strategic move came with the Paco Rabanne license in 1968, which evolved into a full acquisition in 1987. This marked a turning point, signalling Puig’s ambition to move beyond beauty and towards a more diversified fashion-driven model.

This shift must be understood within the broader transformation of the luxury industry following the creation of LVMH in 1987. As LVMH rapidly built a diversified conglomerate across fashion, jewellery, watches and beauty, Puig pursued a similar—though more limited—strategy. It expanded through acquisitions including Carolina Herrera (beauty license in 1987, fashion in 1988) and Nina Ricci (1998), followed later by Jean Paul Gaultier (2011), Dries Van Noten (2018) and Charlotte Tilbury (2020).

Puig: in LVMH's mirror

For nearly four decades, Puig has signalled ambitions that extend beyond perfumery, broadly mirroring LVMH’s model. However, two key differences remain. The first is scale. Puig closed 2025 with revenues of 5.04 billion euros (+5.26 percent) and net profit of 617.1 million euros (+13.74 percent), while LVMH reported 80.81 billion euros in revenue and 11.22 billion euros in profit.

The second is diversification. Despite its acquisitions and brand portfolio, Puig has not succeeded in expanding beyond beauty in a meaningful way. This has limited its ability to fully capitalise on the fashion assets it controls—potential that its IPO on May 3, 2024 was expected to unlock.

Instead, the IPO has underperformed. Shares have fallen by as much as 46.5 percent from their initial price, weakening investor confidence and slowing expansion plans. This context is critical to understanding the current negotiations with Estée Lauder, which—despite being framed as a merger—are widely seen as a potential acquisition.

Such a move would effectively position Puig, once aspiring to emulate LVMH, as an addition to Estée Lauder’s portfolio in its ongoing competition with L’Oréal.

Creating a company worth over 40 billion euros

As doubts persist over whether this is the right moment for Estée Lauder to pursue such a deal, a closer look at both companies’ structures helps clarify the potential scale and implications of the transaction.

Following confirmation of the talks, Estée Lauder lost 5.22 billion dollars in market capitalisation over two days, with its shares falling to 69.75 dollars, reflecting investor caution. Puig, by contrast, has seen renewed momentum in its share price, supported by expectations of a premium over its current valuation. These gains, however, remain contingent on a deal being reached; failure to do so could trigger a reversal and further strain Puig’s positioning, particularly given the tension between its legacy-driven narrative and its willingness to negotiate a sale.

In purely financial terms, the integration would create a group with combined annual revenues of approximately 17.4 billion euros (over 20 billion dollars), based on Puig’s 5.04 billion euros in 2025 sales and Estée Lauder’s 14.33 billion dollars. The resulting entity would have an estimated enterprise value of around 44.85 billion euros (51.67 billion dollars), combining Puig’s 17.48 billion euros and Estée Lauder’s 31.54 billion dollars.

Performance by segment

Looking more closely at operations, Puig structures its business across three segments—“Fragrances and Fashion,” “Makeup,” and “Skincare”—while Estée Lauder reports across five: “Skin Care,” “Makeup,” “Fragrance,” “Hair Care,” and “Other.” Aligning both under Puig’s framework provides a clearer comparison.

In fragrances, Estée Lauder generated 2.49 billion dollars (+0.16 percent) in 2025, compared to Puig’s 3.65 billion euros (+3.78 percent). Combined, this would result in a fragrance division of approximately 5.81 billion euros—still about 616 million euros below L’Oréal’s 6.42 billion euros (+7.9 percent) in the category.

In makeup, Estée Lauder reported 4.21 billion dollars (-4.92 percent), while Puig generated 845 million euros (+10.74 percent). Together, this would produce around 4.50 billion euros in sales, roughly half of L’Oréal’s 8.42 billion euros (-0.4 percent).

Skincare would become the largest segment. Estée Lauder generated 6.96 billion dollars (-11.96 percent) in this category, while Puig contributed 551 million euros (+7.19 percent), resulting in combined revenues of approximately 6.59 billion euros. This remains significantly below L’Oréal’s 16.38 billion euros in skincare.

Additional revenues would come from Estée Lauder’s smaller segments, including hair care (565 million dollars, -10.17 percent) and other activities (100 million dollars, -13 percent), completing the group’s overall revenue structure.

Performance by market

Regionally, both companies divide revenues into three key areas: the Americas, EMEA (Europe, Middle East and Africa), and Asia-Pacific.

EMEA would be the largest market for the combined group, with approximately 7.42 billion euros in sales, based on Estée Lauder’s 5.38 billion dollars (-12.46 percent) and Puig’s 2.75 billion euros (+5 percent). This remains well below L’Oréal’s 14.86 billion euros (+4.6 percent) in the region.

In the Americas, combined revenues would reach around 5.59 billion euros, from Estée Lauder’s 4.41 billion dollars (-3.71 percent) and Puig’s 1.76 billion euros (+2.62 percent), again far behind L’Oréal’s 15.00 billion euros (-0.73 percent).

In Asia-Pacific, Estée Lauder reported 4.54 billion dollars (-7.18 percent), while Puig generated 530 million euros (+16.48 percent), resulting in combined sales of approximately 4.47 billion euros. This also trails L’Oréal’s 14.19 billion euros (+0.16 percent) across the region.

Skincare as main segment, and EMEA as main market

Overall, the merged entity would generate around 17.4 billion euros in annual revenue, with skincare as its largest segment (6.59 billion euros), followed by fragrances (5.81 billion euros) and makeup (4.50 billion euros). This structure highlights Puig’s relatively limited weight in skincare, despite its broader brand portfolio.

Regionally, EMEA would lead (7.42 billion euros), followed by the Americas (5.59 billion euros) and Asia-Pacific (4.47 billion euros), defining the group’s geographic balance.

Beyond these figures, a key strategic question concerns the future of Puig’s fashion assets. Estée Lauder has consistently positioned itself as a beauty specialist, licensing out fashion operations such as Tom Ford’s. A similar approach is likely here, with brands including Jean Paul Gaultier, Rabanne, Dries Van Noten, Nina Ricci and Carolina Herrera expected to see their fashion divisions licensed out and removed from the group’s core scope.

This article was translated to English using an AI tool.

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