"Wedding" conjecture of "Wedding" Tom Ford

21st Century Business Herald reporter Gao Jianghong intern Feng Zhixin Beijing report

Recently, the luxury industry and investment circle are restless because the "noble son" Tom Ford has reported the news to be sold. For a while, the pursuers had the intention of Estee Lauder and Kaiyun Group.

Kaiyun Group and Tom Ford have "front edge". The former creative director of GUCCI and YSL, the two important brands of Kaiyun, is the founder of Tom Ford. Tom Ford is now hot -fragrance business. Sweet business line. Recently, Jean-Franois Palus, managing director of the company, said at a conference call after the annual performance meeting that the group will further develop a beauty business.

El.us, which has been working with Tom Ford to develop fragrant products, also reported Tom Ford to buy Tom Ford. After all, Tom Ford is the brand with the most profitable profits in its financial report. Estee Lauder's 2022 financial report shows that the net sales of perfume products reached 2.508 billion US dollars, an increase of 30%year -on -year. It is the fastest -growing department with revenue of 456 million US dollars, an increase of more than 100%year -on -year.

Those who want to climb with Tom Ford are not the only two, and more capital with more cash flow in hand is in the dark. Who is the ideal owner?

Reorganize business landscape?

Tom Ford was founded in 2005 by legendary fashion designer Tom Ford. Prior to this, Tom Ford had worked in Gucci for 10 years, redefining Gucci from the end of the bankruptcy, glowing the Chinese New Year, sales revenue has been nearly 20 times, the brand value has pushed to the pinnacle, and GUCCI has acquired another famous fashion brand St. Roland. The legendary experience makes it a popular figure in the fashion industry and has great influence in the younger generation.

In 2004, Tom Ford left GUCCI to create his own brand of the same name and started from high luxury men to become a top luxury brand in one fell swoop. Subsequently, the Tomford product line gradually expanded to women's clothing, handbags, glasses accessories, high -end watches, perfumes and cosmetics.

Tom Ford has always been well -known in the fashion field. It is one of the most important "facade brands" in New York Fashion Week. It attracts high -end consumers through the unusual luxury and sexy wind design of different brands. Tom Ford's fragrance and beauty products are positioned high -end, but they are favored by consumers and occupy half -walls of revenue. Industry insiders estimate that Tom Ford's beauty business has exceeded $ 1 billion in sales as early as 2019.

Although Tom Ford also develops pain in the hearts of consumers, its men's suits, fragrance products and glasses business have been authorized to other groups. Among them, Tom Ford Beauty and high -end skin care product line Tom Ford Research are jointly developed by Tom Ford Research, which is also responsible for the production of Tom Ford beauty and perfume products. Tom Ford's glasses business authorized the glasses giant Marcolin Group for design, production and distribution.

Tom Ford's men's suit is responsible for production by Ermenegildo Zegna, Italian luxury group. According to the Zegna financial report, after the 2022 autumn and winter series, the exclusive authorization of the two sides will cooperate, and Zegna will continue to produce some products for Tom Ford.

Affected by the epidemic and other emergencies in the past two years, Tom Ford missed the Fashion Week of 2021 and 20122. In February last year, Tom Ford originally scheduled to participate in New York Fashion Week because the epidemic was temporarily canceled. Earlier this year, Tom Ford was unable to complete the work in time due to the epidemic situation of the brand design department and the location of the production plant. In desperation, I was absent from New York Fashion Week again. I could only publish new products through the digital album. Tom Ford himself was deeply regrettable.

Therefore, the industry speculates that integrating business maps and seeking a more stable supply chain to enhance the ability to resist risks may be the purpose of Tom Ford for sale. It is reported that Tom Ford is the largest shareholder of the company and holds over 60%. Tom Ford's sale is not Tom Ford's abandonment of the brand created by himself. It is more intended to find partners. The possible way of selling cooperation includes the future new owner and Tom Ford to jointly operate the brand.

Since it is not for the purpose of selling it, Tom Ford's choice of buyers is likely to start based on its own development purposes, and buyers who are complementary to resources and business may "get married". Based on this judgment, what is the degree of matching of several companies in the "scandal"?

Choose Estee Lauder to form a brand matrix

Take a look at Estee Lauder first. Tom Ford and Estee Lauder have been closely cooperating, and the cooperation between the two sides has brought a generous return to Estee Lauder. Estee Lauder's latest 2022 fiscal year showed that the net sales of perfume products reached 2.508 billion US dollars, an increase of 30%year -on -year. It is the fastest -growing department, with revenue of 456 million US dollars, an increase of more than 100%year -on -year, and operating profit margins reached reached reach 18%(operating income is derived from net sales). According to industry analysts, perfume may follow the redemption point of the revenue of the next cosmetics group after lipstick. And Estee Lauder's rise in the field of perfumes in this quarter is closely related to the strong growth of Tom Ford Beauty's net sales. Relying on the outstanding performance of Signature and Private Blend and the launch of the Ombre Leather series, fiscal 2022, Tom Ford Beauty achieved a strong double -digit growth. The dazzling performance of the Tom Ford perfume series makes Estee Lauder unable to give up Tom Ford Beauty. The best way is to directly buy Tom Ford, once and for all.

In addition to being optimistic about the strong position of Tom Ford Beauty in the market, Tom Ford's high positioning and high value -added as a luxury brand are also very attractive to Estee Lauder Group.

On the one hand, the acquisition of Tom Ford is a requirement for execution of high -end strategies. In the new financial report of beauty giants, the advantages of high -end products are further highlighted. Estee Lauder's 2022 financial report shows that the top skin care brand La Mer led the category revenue with double -digit revenue growth.

Another beautiful makeup giant L'Oreal also praised the strong performance of the high -end brand department in the semi -annual report of fiscal 2022, an increase of 16.4%year -on -year, especially the Takami and Youth to the People in the newly acquired TAKAMI and YouTh to the People. Essence

Tom Ford has always been a luxury in the beauty of the makeup. In recent years, it has also cooperated with Estee Lauder to develop high -end skin care products with Estee Lauder in recent years. Tom Ford Research, which are cooperated with, is promising. After the development of maturity, the profits brought by Estee Lauder may not be inferior to LA MER.

On the other hand, the acquisition of Tom Ford is also conducive to Estee Lauder, while further strengthening the brand matrix and consolidating the status of a beauty giant, or can enter the luxury field by Tom Ford fashion, watches, and glasses. For Estee Lauder, although this step is huge, it is not impossible.

The growth process of the world's largest luxury giant LVMH Group provides a good reference for the group with ambitions in the field of luxury goods. LVMH itself is a symbol of cross -border. It is merged by Louis Vuitton Group from the leather box and the high -end wine industry from the high -end wine industry. After three sections of M & A peaks and won more than 50 luxury brands, the LVMH Group eventually became a behemoth in the fields of leather fashion, perfume cosmetics, jewelry watches, wine liquor, hotel tourism, etc., with a market value of more than 300 billion euros, 2021 2021 The annual revenue is as high as 64.2 billion euros.

The exemplary role of the industry boss has strongly stimulated multiple luxury groups to drive a diversified strategy. Kaiyun, Hermes, Chanel and other business tentacles have gradually reached the business field of Estee Lauder, and many luxury brands choose self -operated fragrance beauty. To be connected with short soldiers.

According to the 2022 financial report of Estee Lauder, as of June 30, Estee Lauder held $ 2 billion in free -flowing funds. This may be the first step for Estee Lauder to try to start cross -border funds for Estee Lauder.

For Tom Ford, on the one hand, Tom Ford has cooperated with Estee Lauder for 16 years. Choosing Estee Lauder as a long -term partner as the new owner can not only ensure the stability of cooperation, but also help the cooperation to further deepen and strengthen the research and development of skin care products.

On the other hand, Estee Lauder's strong aromatherapy research and development capabilities and brand matrix can also share the risks of Tom Ford under the epidemic. Estee Lauder has its own brand group in various segmented business departments in the field of fragrantization, and achieves full consumer group coverage through the brand matrix. Tom Ford can both accurately faces high -end consumer groups and can also become the choice of consumer consumption upgrade of secondary brands.

Besides, if Estee Lauder made a cross -border, in addition to the existing cooperative business, Tom Ford's fashion, handbags, glasses accessories and other businesses will also be valued by Estee Lauder. risks of.

But it is also risky for Tom Ford to join Estee Lauder. When the external risks brought by factors such as epidemics are jointly borne by the group brand matrix, the internal competition of the matrix or even "internal rolls" may bring new pressure on Tom Ford.

In addition, Estee Lauder has limited resource experience in the field of fashion and luxury goods, and cannot directly support other businesses except for beauty business. In particular, it is impossible to solve the problem of fashion supply chain. The production of Tom Ford men's suits and glasses business may continue to entrust other groups to conduct, and the supply chain weakness is still a pain point.

Join Kaiyun's exclusive fragrant chemical category?

Since Estee Lauder is not perfect for Tom Ford, what about Kaiyun Group? Kaiyun is Tom Ford's own old family. When Tom Ford is seeking to sell, it is likely to become a new owner of the Tom Ford brand. After all, Kaiyun has a large amount of free cash as the bottom of the bidding, and is very interested in beauty.

At the previous performance analysis meeting, the executives of the Kaiyun Group have admitted that the brand portfolio needs to be improved. Compared with the "old opponent" Lu Weiming Xuan Group, the business is fully blossoming. Kaiyun seems to be monotonous. Mainly with fashion, Gucci still occupies a big head in the revenue structure. According to Kaiyun Group's financial report in the first half of the fiscal year in 2022, Gucci is still the core of the group, accounting for 52.1%of Kaiyun's revenue in the first half of the year, and 66.9%of regular operating income.

In addition to the rich income on fashion and leather goods, there are more than half of the income from other business segments. For example, in the first half of the fiscal year in 2022, the perfume beauty business recorded US $ 3.618 billion in revenue, with a profit margin of 10.7%; the high -end wine industry recorded US $ 3.327 billion, with a profit margin of 34.7%. The income was 3.3 billion euros, and the profit margin was also 34.9%.

At this time, Kaiyun held a free cash of 2.049 billion euros. The acquisition of Tom Ford can not only fill the gap in the group's aromatherapy field, but also further optimize the brand portfolio, reduce the dependence on Gucci, and enhance the group's anti -risk ability.

Kaiyun Chief Financial Officer Jean-MARC Duplaix stated at the beginning of the year that the group will continue to pay attention to potential brands and consider acquiring when appropriate. The CEO Francois-Henri Pinault revealed that in order to improve the brand portfolio, the group has been looking for opportunities. At the recent conference call, Jean-Franois Palus further clarified that the self-operated beauty business will become the next development direction of Kaiyun Group.

It is understood that Kaiyun did not belong to its own fragrance business, and the fragrance business of various brands of the group could not be directly operated by the group. The perfume beauty business of Gucci, Alexander McQueen and Bottega Veneta is responsible for COTY. Saint Laurent Beauty is handed over to L'Oreal Group, and the beauty sideline of the other jewelry brands is handed over to other companies. Kaiyun had expressed dissatisfaction with the insufficient development of the GUCCI brand in the COTY Group. According to people familiar with the matter, the licensed business agreement signed by Kaiyun Group and the COTY Group for more than 5 years may expire in 2028.

The income brought by the beauty to Kaiyun only has the costs charged when the authorized cooperation object operates the fragrance business, and it accounts for less in the brand income pattern. According to the semi -annual report announced by Kaiyun's recently, the "Others" part of the revenue disclosed by each brand can be seen that the fragrance business and glasses business charged by the various brands under Kaiyun in the first half of the year The total income is less than 6%.

Kaiyun's glasses business first also adopted outsourcing models. Until 2015, Kaiyun set up the glasses department to support the research and development and sales of various brands of glasses and sidelines. With the return of its brand glasses business, the development of the Kaiyun Glasses Department has developed rapidly, bringing 576 million euros to the Group in the first half of fiscal 2022, an increase of 50%year -on -year. In the next step, as the latest report of Citibank's European luxury research director Thomas Chauvet pointed out, Kaiyun may consider operating fragrance business to promote the coordinated benefits between brands. And this is what Lvmh, Chanel and Hermes are doing it.

For Tom Ford, while joining Kaiyun as the leader of the group's beauty fragrance business, the business, watches, glasses and other businesses are also expected to use Kaiyun's existing luxury business experience and resources to enhance the stability of the supply chain to stabilize the supply chain Sexual risks brought by the epidemic. In a special period when the luxury industry has suffered from epidemic, choosing a luxury giant can indeed be sheltered to Tom Ford.

However, it should be noted that this asylum is not free of charge. Other businesses other than Tom Ford's fragrance business may pay for Kaiyun's asylum. Tom Ford's fashion, watches and glasses business is not as great as Kaiyun's attractiveness. Maybe after joining Kaiyun, Tom Ford's part of the business will fall into the internal competition with other luxury brands in the group.

At the same time, due to the current COTY Group and L'Oreal Group and the Estee Lauder Group, COTY Group and L'Oreal Group may affect the follow -up cooperation between Tom Ford and Estee Lauder. At the same time, if Kaiyun wants to start self -operated beauty and build a production line from Tom Ford, this will also directly affect the stability of Tom Ford's research and development and operation. Although Tom Ford entered Kaiyun, the first place in the fragrance category means a certain degree of resource tilt, but Kaiyun's bonus to Tom Ford is very limited.

Other potential bidders are hidden in the dark?

Although it seems that Kaiyun and Estee Lauder are the most likely New owners of Tom Ford, Tom Ford is the top luxury brand in the beauty field, and more than these two people attract buyers.

Because of its high profit margin and good performance during the epidemic, many luxury brands are eager to move. Italian luxury brand Prada recently opened a beauty account on social media platforms, opened the official website of the beauty, and predicted that Prada perfume will be launched. This series of actions show that Prada may seek further development in the beauty market.

PRADA Group Chairman Paolo Zannoni revealed last month that Prada will be listed for the second time in Milan Capital Market. The IPO plans to raise $ 1 billion. What kind of story should I tell the capital market after listing to attract enough attention? There are guessing that the acquisition of Tom Ford will be the most gimmick version that Prada can give. The combination of both parties is a space full of imagination.

In addition to Prada, there is also a potential bidder with strong financial resources, which also needs to tell stories to the capital market. On August 12, the Ferrari shareholder EXOR Group officially listed on the Amsterdam Pan -European Stock Exchange and will officially delist from the Milan Pan -European Exchange on September 27.

Exor Group is one of the largest diversified holding companies in Europe. In the past two years, it has invested in the luxury field, including the controlling shareholder who replaced Hermes to become the "upper and lower" of Chinese luxury brands. It has the equity of the French luxury shoes brand Christian Louboutin. In December last year, EXOR clearly stated that the field of luxury goods was the future development of the group. In July, EXOR's insurance department sold it with 8.6 billion euros in cash to provide strong financial support for EXOR's luxury strategy.

EXOR Group has both money and luxury investment plans. At the same time, it is necessary to show their sharp edge to investors after entering the larger capital market. Although EXOR is more preferred to luxury brands in Italian descent, it is rare to sell it with a top luxury brand like Tom Ford, will EXOR let it go?

Whether it is Kaiyun or Estee Lauder, or other potential bidders, it is worth considering for Tom Ford. Similarly, whether it is Kaiyun, Estee Lauder, or other groups, the acquisition of Tom Ford is an important step in the group's further cross -border expansion and implementing a diversified strategy. Become part of the Estee Lauder matrix or help Kaiyun's development of fragrance business, which is conducive to enhancing Tom Ford's anti -risk capabilities and product supply capabilities. It is only in the adjustment direction of the Tom Ford business map. There are differences between the two.

- END -