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Puig Group, a family-owned Spanish cosmetics group, is preparing for an initial public offering in the coming weeks in which it aims to raise more than 2.5 billion euros in the largest public offering in the sector in years.
The Barcelona-based company, which owns perfume and makeup brands ranging from Paco Rabanne to Charlotte Tilbury, announced its plans to list in Madrid and on other Spanish stock exchanges in a regulatory filing on Monday.
Bankers estimate the value of the 110-year-old business at between €8 billion and €10 billion. The company said it wants to raise about 1.25 billion euros through an IPO, followed by a “larger” secondary share sale that would take the total amount raised to more than 2.5 billion euros.
The IPO of Puig, which describes itself as a “premium beauty” group, is likely to be the largest in the luxury space in terms of capital raised since Ermenegildo Zegna in 2021. But it could still be overtaken by Golden Goose, which is a Italian footwear brand, which is also expected to float this quarter.
The Puig family intends to retain a majority stake in the company, but has not specified exactly what percentage of shares it will sell. The family will own A shares, each giving 5 votes, while B shares will be offered to outside investors, giving 1 vote.
Puig's move comes as Europe's initial public offering market enjoys its strongest start in a year since the pandemic, after a long slowdown. Rising stock indices and the prospect of lower interest rates have encouraged more companies to seek a listing, including dermatology group Galderma, controlled by Swedish buyout group EQT, which raised 2.3 billion Swiss francs ($2.5 billion) in March.
However, not all deals went smoothly. Shares of German cosmetics trading company Douglas fell by as much as 9 percent in its debut in Frankfurt last month.
Puig's flotation comes as the luxury goods sector faces the end of a post-pandemic spending boom. But the group insisted that it had the flexibility to face reduced consumer spending, because the unit price of its perfumes and cosmetics was lower than the price of watches, handbags and other luxury products.
In 2023, the company, which operates in 32 countries and also owns Carolina Herrera and Nina Ricci, reported record net revenues of €4.3 billion and net profit of €465 million, up 16 percent on the previous year.
“It's important for any family business to have the right checks and balances, especially during generational transitions,” said Marc Puig, chairman and CEO and the third generation of his family to lead the company.
“We believe that the balance between being a family-owned company and also being accountable to the market will allow us to better compete in the international beauty market during the next phase of the company’s development,” he added.
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Puig has led the company since 2004, and said he will be the last generation of the family to head the company, although he has no plans to step down.
“We strongly believe that building premium brands requires long-term thinking, and having a family backing the company reinforces this long-term approach, as they tend to care equally about the time horizon of the next generation and the next quarter,” he added. He said.
The company said it would “continue to selectively evaluate” further potential acquisitions, but noted that the immediate use of the funds raised would be to purchase minority stakes in brands it has already acquired.
Bouigs is a small company compared to sector leaders L'Oréal and Estée Lauder, but it has grown rapidly through acquisitions in the past decade, closing 11 deals in the past 12 years.
These purchases included British cosmetics company Charlotte Tilbury, French brand Jean Paul Gaultier, and Belgian fashion house Dries Van Noten.
Additional reporting by Adrian Kalasa in Paris
