Operations of stila are expected to continue, and the Stila Corp. team will immediately assume responsibility for all decisions regarding the future direction of the brand. The sale was effective April 10, 2006. The Estee Lauder Companies Inc. and its subsidiaries will be providing certain transition services in connection with the sale. Terms of the deal were not disclosed.
The Estee Lauder Companies Inc. has accounted for stila as a discontinued operation since the quarter ended September 30, 2005. It announced its intention to seek a buyer for the brand on October 26, 2005. The Company expects to take an additional charge to discontinued operations as of the end of its fiscal third quarter related to the sale. The exact amount of the charges has not been determined at this time. The Company plans to announce the third quarter charge and an estimate of any future charges when it announces its third quarter earnings in early May 2006.
"We are pleased to be selling stila to Stila Corp. and Sun Capital," said William P. Lauder, President and Chief Executive Officer, The Estee Lauder Companies. "Jane McKellar and her colleagues are talented, experienced executives who are passionate about cosmetics and the stila brand. We believe this bodes well for the brand's future. At the same time, we are pleased that our Company has taken this important step in our drive to optimize our portfolio of brands."
Stila, a color cosmetics makeup-artist brand, was acquired by The Estee Lauder Companies in 1999. It is currently sold in specialty and department stores in about 13 countries, as well as in selected Travel Retail outlets around the world.
"We want to express our appreciation to stila's employees for their contributions to the success of the brand," said Patrick Bousquet-Chavanne, Group President, The Estee Lauder Companies. "We are grateful for their dedication and passion."
Going forward, The Estee Lauder Companies remains committed to growth in the makeup artist-brand category with its MAC and Bobbi Brown brands, and looks to achieve continual performance improvement from each of its divisions, consistent with their business plans and long-term strategic objectives.
The forward-looking statements in this press release, including those containing words like "expect," "believe," "plans," "going forward" and "looks," involve risks and uncertainties. Factors that could cause actual results to differ materially from those forward-looking statements include the ability of the new owners to manage the stila business in a highly competitive environment, the final accounting for the sale and related transactions and the success of the Company's makeup and other brands.
The Estee Lauder Companies Inc. is one of the world's leading manufacturers and marketers of quality skin care, makeup, fragrance and hair care products. The Company's products are sold in over 130 countries and territories under well-recognized brand names, including Estee Lauder, Aramis, Clinique, Prescriptives, Origins, MAC, Bobbi Brown, Tommy Hilfiger, La Mer, Donna Karan, Aveda, Jo Malone, Bumble and bumble, Darphin, Michael Kors, Rodan + Fields, American Beauty, Flirt!, Good Skin(TM), Donald Trump the Fragrance, Grassroots, Sean John and Missoni.
© 2006 Business Wire
