Smashbox is a privately-held company that sells studio-inspired prestige cosmetic products, and was founded by the great grandsons of make-up guru Max Factor.
Although the financial details were not disclosed, Estée Lauder said the acquisition is scheduled to be finalized in July 2010 and is expected to be accretive to earnings in fiscal 2011 before transaction and integration costs.
Attracting a new breed of consumer
The acquisition of the Smashbox brand, which is mainly sold in the North American market in assisted open-sell environments and specialty distribution channels, will help Estée Lauder boost its portfolio and attract a new consumer demographic, according to the company.
The beauty giant also said it plans to tap into Smashbox’s expertise of digital and social media in order to increase its own competencies in this area.
“Adding Smashbox to our portfolio of brands will help strengthen our presence in prestige specialty channels worldwide, increase our product offerings in this important category and enhance our capabilities in digital media and direct response television,” said Fabrizo Freda, President and CEO of Estee Lauder.
“We are energized by the promising momentum of Smashbox and believe that the brand will help attract new and younger customers to The Estée Lauder Companies all over the world,” he added.
Integration of the brand
According to Estée Lauder, upon completion of the acquisition, Smashbox will be integrated into the company’s stable of brands, although co-founders Dean and Davis Factor and President Budd Taylor will continue to play key roles in its future success.
“We expect to benefit greatly from The Estée Lauder Companies’ extensive knowledge in product development, operational execution, and international marketing and distribution, and we look forward to the next period of growth for the brand,” said Smashbox co-founder and CEO Dean Factor.
Smashbox will continue to operate from its office in Los Angeles, California; it was said in a statement.