The partnership between Estée Lauder and Tom Ford’s fashion house likely made Ford a billionaire. On Tuesday, the cosmetics conglomerate revealed that it would be acquiring the fashion label for $2.3 billion in cash and debt, with an additional $300 million in deferred payments that would be distributed annually beginning in July 2025.
Estée Lauder will receive $250 million from Marcolin, an Italian eyewear business that holds the license for Tom Ford’s line of glasses, as part of the deal, bringing the total worth of the company to $2.8 billion.
At 61 years old, Ford is expected to net roughly $1.1 billion after taxes from the transaction, according to Forbes. As of a filing made in 2013, Ford owned approximately 64% of the company. He does not appear to have reduced his holdings at all since then.
His two mansions, one in Los Angeles’s Holmby Hills and the other in Manhattan’s Upper East Side, are valued at a combined $65 million. The total value of Ford has increased to around $1.2 billion. When reached for comment, neither Estée Lauder nor Tom Ford promptly responded.
The transaction was profitable for more than just Ford. A fifteen percent share in the company was owned by Italian high-end retailer Zegna, estimated to be worth $345 million (pre-tax). Domenico De Sole, Ford’s long-time business partner, owned little over 11% of the company, which was then worth $259 million (pre-tax).
The other 10% was held by Grupo Americo Amorim, a Portuguese corporation founded by the late billionaire “King of Cork” Americo Amorim (d. 2017.) and is now worth $230 million before taxes.
According to Zegna’s most recent annual report, which is available to the public, Tom Ford made $96 million in profit on sales of $1.7 billion in 2021. Zegna will continue to hold a long-term license for Tom Ford’s clothes and accessories.
Profits for the company turned positive in 2018 after two consecutive years of decline. The United Arab Emirates, China, Italy, Japan, Russia, Switzerland, and other nations are only a few of the countries with Tom Ford retail outlets.
According to the announcement announcing the arrangement, Ford will remain on board as a “creative visionary” until the end of 2023. The Estée Lauder Companies is a perfect fit for the brand, and I am thrilled with the acquisition,” Ford stated. They’ve been a fantastic partner ever since I founded the company, and now they’re taking over as Tom Ford’s luxury brand guardians, and I couldn’t be happier.
About Ford & His Acquisitions
Ford moved to Santa Fe, New Mexico, as a child and later attended New York University to study art history after being born in Austin, Texas, in 1961. His next stop was New York and Paris, where he studied architecture at the Parsons School of Design.
Taking a year off from school to work in the Paris publicity office of Chloé, a French luxury fashion business is said to have sparked his interest in the fashion industry. He found employment with sportswear designer Cathy Hardwick soon after finishing college.
In 1990, Ford got his big break when he was hired as Gucci’s womenswear designer in Milan. Within a short period of time, he worked his way through the ranks to become the brand’s design director in 1992 and then its creative director in 1994.
Domenico De Sole, who is now his business partner, was the CEO of Gucci when he first met him. They were instrumental in Gucci’s 1995 IPO on the bourses in Amsterdam and New York.
However, the IPO made the company a target for industry giants who saw an opening in the market. To the tune of $176.1 billion, Bernard Arnault, chairman, and CEO of luxury goods giant LVMH, bought a stake of 5% or more in Gucci in January 1999. Soon after, Arnault bought a 9.5% stake from Prada’s billionaire co-CEO, Patrizio Bertelli.
By February 1999, LVMH had amassed a 26.7% stake in Gucci. Arnault “simply asked himself over to supper without phoning first,” De Sole said of him to Forbes at the time.
March of 1999 saw the acquisition of a 40% stake in Gucci by François Pinault, another French fashion tycoon, and creator of luxury conglomerate Kering, for $3 billion. Thanks to this, Gucci was able to grow, and in 2000, they acquired Yves Saint Laurent, promoting Ford to the post of creative director for the entire group.
Still, Pinault and Arnault fought for control of Gucci until 2001, when Pinault bought 50% of Arnault’s shares for $752 million ($1.3 billion adjusted for inflation) and committed to buying out the rest of Arnault’s interests by 2004.
Sales at Gucci increased by about 1,200% between 1994, when Ford was appointed creative director, and 2003 when they reached nearly $3 billion. For Gucci, Ford and De Sole managed the purchases of Balenciaga and Bottega Veneta, two more high-end fashion houses. But Ford left Gucci soon after Pinault finished buying it in April 2004. It seems that he had problems with how the company was being run.
Ford went solo and launched his own company
In March of 2005, Ford went solo and launched his own company; he recruited De Sole to serve as chairman. In 2007, Ford launched its first flagship store in New York and sold a 25% stake in the brand to Grupo Amorim for an unknown sum. Amorim sold 15 percent of Tom Ford to Zegna in 2015, reducing its ownership to 10 percent.
Ford has invested in the arts and real estate over the years, reputedly making $32.6 million off the sale of an Andy Warhol self-portrait in 2010. Before selling it in January 2021 for an undisclosed sum, he also held the 20,662-acre Cerro Pelon Ranch in New Mexico, which was used as a filming site for movies including Silverado and Thor.
Then, two months later, he made a $17 million sale of a Victorian mansion with four stories in London’s chic Chelsea neighborhood.
After 2023, when his contract with Estée Lauder expires, Ford’s plans are a mystery. Regardless of his future plans, the newly minted billionaire will have plenty of money.