Two major beauty families accelerate their marriage: Estee Lauder Companies Inc. Class A (EL.US) and Puig (PUGBY.US) discuss stock exchange merger plan to create a new global beauty giant.

According to informed sources, Estee Lauder Companies Inc. Class A (EL.US) and Spanish beauty group Puig Brands (PUGBY.US) are in advanced negotiations regarding a merger. These two family-controlled companies are expected to join forces to create a global top luxury cosmetic giant. Sources say that the two companies, which respectively own brands such as MAC, Le Labo, Charlotte Tilbury, and Byredo, are discussing a deal centered around share-based payment method, with the announcement of the plan expected to be made officially in the coming weeks. The sources also stated that under the terms of the agreement, Puig's Chairman Marc Puig will join the board of the merged company and is expected to play a key role in the integration of the two companies. Marc Puig, a core member of the Puig family, holding a significant position, will lay an important foundation for the transaction and ensure the smooth transition of business operations. Marc Puig was still serving as CEO of the company until last month. At present, a final agreement has not been reached by both parties, and there is still a possibility of negotiations breaking down, with the timing of the announcement also uncertain. Estee Lauder Companies Inc. Class A has not immediately commented, while a Puig spokesperson declined to respond. On March 23 of this year, Estee Lauder Companies Inc. Class A and Puig confirmed that they were in discussions about a potential business merger, but did not disclose specific terms of the deal. If Estee Lauder Companies Inc. Class A, still controlled by the Lauder family, completes a merger with Puig, it will reshape the global high-end beauty competition landscape and quickly create a significant competitor to French cosmetics giant L'Oreal (LRLCY.US). Currently, Estee Lauder Companies Inc. Class A ranks second in the global beauty industry after L'Oreal. Once merged, the two companies will particularly hold a more solid leading position in the perfume market. The size of this transaction is significant. Puig, listed in Madrid, has a market value of 9.8 billion euros (approximately 11 billion US dollars), while Estee Lauder Companies Inc. Class A, listed in New York, has a market value of about 27 billion US dollars. Since the confirmation of the merger news last month, Estee Lauder Companies Inc. Class A's stock price has fallen by about 15%, while Puig's stock price has risen by 11%. Amid escalating supply chain risks, political turmoil in the GEO Group Inc, continuing inflation pressures, and changing consumer habits, consumer and retail companies are actively seeking merger opportunities to enhance competitiveness by expanding their scale. Under the leadership of CEO Stphane de La Faverie, Estee Lauder Companies Inc. Class A is currently undergoing a business transformation, gradually shifting its brand retail channels towards high-growth online platforms such as Amazon.com, Inc. (AMZN.US). Puig has also completed management adjustments in recent months, with founding family member Marc Puig stepping down as CEO and remaining as Chairman, focusing on mergers and acquisitions-related strategic initiatives.