Estee Lauder yesterday said it will buy Smashbox, with plans to expand the Los Angeles cosmetics firm in the US and globally.
Smashbox — which has attracted a younger following by embracing online and social media — has potential to steal customers from bigger brands, said Estee Lauder CEO Fabrizio Freda. The brand is already strong in the US, Canada, the UK and Taiwan, he said.
Smashbox’s closest competitor is MAC, which is already owned by Estee Lauder. While MAC had sales of $100 million when Estee Lauder took full ownership in 1998, it has grown into a $1 billion business, and Smashbox could follow a similar trajectory, executives said.
The deal, which is slated to close in July, will add to earnings in fiscal 2010 before transaction and integration costs, Estee Lauder said.
Smashbox was founded in 1996 by two great-grandsons of cosmetics pioneer Max Factor.