The Estée Lauder Companies announced Monday it had completed its acquisition of Deciem Beauty Group, the multi-brand company that sells skin-care products through The Ordinary and NIOD brands.
ELC first invested in Deciem in 2017, then increased its stake to become majority owner in 2021 before purchasing the remaining interests in Deciem on May 31 for around $860 million. Total investment across three rounds is approximately $1.7 billion, according to The Estée Lauder Companies.
“We are incredibly proud of what Deciem is accomplishing,” Fabrizio Freda president and CEO of ELC said in a statement. “In our seven years of partnership, Deciem has achieved impressive growth while continuing its core mission of reimagining effective, high-quality skincare for today’s diverse and sophisticated consumers.”
The acquisition comes at a time when ELC is executing a ‘profit recovery plan,’ which includes 3,100 job cuts, to rebound from soft sales in China and stateside. In its third-quarter 2024 earnings report, ELC’s Freda mentioned The Ordinary as a sales leader.
“For the third quarter of fiscal 2024, we delivered our organic sales outlook, exceeded expectations for profitability and continued to improve working capital,” ELC’s Freda said in a statement. “La Mer, Estée Lauder, Jo Malone London, Le Labo and The Ordinary led organic sales growth, driven by beloved hero products and highly sought innovation.”
As a heritage conglomerate, ELC benefits from the innovation and marketing prowess of Deciem, which is vertically integrated, offers clinical skin care at mass pricing and markets to savvy beauty consumers, often called “skintellectuals.” Meanwhile, Deciem has had access to ELC’s infrastructure and resources to expand. Most recently, The Ordinary has expanded to India, The Middle East and South Africa.
According to ELC, The Ordinary is in the company’s tier of scaling brands, each of which has net sales between $500 million-$1 billion.
“As a digitally native organization with a highly engaged following among millennial and Gen Z consumers, Deceim helps to strategically expand our skin-care portfolio, and we believe there are many more exciting growth opportunities ahead,” ELC’s Freda said in a statement.
“Today The Estée Lauder Companies becomes the forever home of Deciem,” said Nicola Kilner, co-founder and CEO of Deciem. “Our founder Brandon set out to disrupt the world of beauty, and this thinking has been embraced by ELC over the past seven years of our partnership. Their support, along with the energy of our incredibly talented team, has allowed us to strengthen our operational capabilities and enter new markets, while staying true to our founding values of transparency, quality and authenticity.”
