Estée Lauder Shifts Away from Dr.Jart+ Sale, Focuses on Reassessing Brand Value

Industry observers are increasingly pointing to a possible strategic shift by Estée Lauder regarding Dr.Jart+, a brand that had recently been the subject of acquisition rumors. 
 

[Image by Estee Lauder]

While the company initially explored a divestment as part of a broader portfolio restructuring effort, analysts now suggest that greater emphasis is being placed on reassessing the brand's value and developing long-term growth strategies rather than pursuing an immediate sale.
 
According to multiple industry sources, Estée Lauder had originally considered selling three brands as part of a package deal. However, Too Faced and Smashbox have reportedly been prioritized as potential divestment targets, while Dr.Jart+ is undergoing a reassessment of its enterprise value amid rising interest in K-beauty and the brand's future growth prospects.
 
Beauty industry media outlets previously reported that Estée Lauder had explored selling Too Faced, Smashbox, and Dr.Jart+ together as a bundled transaction. The company later revised its approach, separating Dr.Jart+ from the package and evaluating it as a standalone asset. Industry experts believe this change reflects more than a simple restructuring of the sales process and may indicate a broader reevaluation of the brand's strategic importance.
 
One key factor behind the shift is the potential recovery of Dr.Jart+'s business in China. The brand has continued expanding its distribution network and repositioning its image in the Chinese market. Industry sources suggest that any improvement in operating performance could lead to a significant reassessment of the brand's value.
 

Changes within Estée Lauder's management structure are also viewed as an important variable. Since the appointment of new President and CEO Stéphane de La Faverie, the company has launched a broad strategic review focused on cost reduction and restoring brand competitiveness. Industry insiders note that management priorities appear to be moving away from short-term asset disposals and toward rebuilding the value of key brands.
 
Another notable factor is that the originally proposed package-sale structure reportedly failed to attract the level of market interest that had been anticipated. According to industry sources, potential buyers were hesitant to acquire Too Faced and Smashbox, both of which have experienced performance challenges in recent years. As a result, the competitive bidding environment Estée Lauder had expected did not fully materialize. The company subsequently adjusted its transaction structure, prompting a separate review of Dr.Jart+.
 
Perhaps the most closely watched issue is Dr.Jart+'s current valuation. Estée Lauder acquired Have & Be, the parent company of Dr.Jart+, in 2019. However, market estimates suggest that the brand's current valuation remains significantly below the acquisition price paid at that time.
 
An investment banking source commented, “With the K-beauty market entering a new growth phase, many believe it would be more rational to enhance Dr.Jart+'s brand value before considering strategic options rather than rushing into a sale.”
 
Indeed, growing consumer interest in K-beauty across the United States and Europe has strengthened expectations that Dr.Jart+ can reduce its reliance on China while securing new growth drivers. Consequently, more industry participants are beginning to view the brand not as a divestment candidate but as a long-term strategic asset.
 
As a result, market observers increasingly believe that Dr.Jart+ has shifted its focus from a potential sale to executing growth initiatives and that the divestment process may effectively be on hold for the foreseeable future.
 
  

정현식 기자