Puig stock soars 15% after Estée Lauder confirms takeover talks

shares Puig Brands It rose as much as 15% on Tuesday after beauty specialist Estée Lauder confirmed the companies were in talks about a potential merger.

Estée Lauder said in a statement late Monday that no final decision had been made on any potential deal, first reported by the Financial Times. He did not disclose any financial terms.

Puig shares were last up 14.6%. Shares of Estée Lauder rose less than 1% in premarket trading after falling 7.7% in the previous session following the initial report on the merger.

The combination of larger US-listed Estée Lauder and smaller Spanish Puig will bring some of the world’s biggest beauty and fragrance brands under one roof, including Tom Ford Beauty, Carolina Herrera and Clinique.

Puig had a market cap of approximately 8.8 billion euros ($10.2 billion) at the trading session, while Estée had a market cap of $28.7 billion.

Estée Lauder is in the early stages of a transformation to revive growth, and efforts include layoffs. The company’s woes have been exacerbated by US tariffs, which it flagged in February will impact its full-year profitability by $100 million. Shares are down 24% since the beginning of the year.

Puig, meanwhile, has seen sales steadily rise since going public in 2024, with a portfolio spanning fragrance, skincare and makeup under brands including Charlotte Tilbury, Nina Ricci and Rabanne.

Investors do not tend to favor large-scale deals, Citi analysts said, as evidenced by stock reactions to recent high-value deals among food and beverage companies. Keurig And JDEP and consumer goods players Kimberly-Clark And Kenvue.

While a deal of this size creates “complexity and execution risk,” analysts led by Filippo Falorni estimate that the merger could result in synergies of 5% of target sales and double-digit growth in earnings per share in the first year.

Deutsche Bank noted that Estée Lauder’s share price “clearly signals market concern” about a potential deal.