Puig’s upcoming IPO is ready to be glamorous.
The corporate, which owns fragrance and wonder manufacturers like Paco Rabanne, Charlotte Tilbury and Byredo, will go public in Spain’s largest itemizing in almost a decade. It’s additionally Europe’s most outstanding IPO this yr, anticipated to fetch a €14 billion ($15 billion) valuation.
The Barcelona-based family-run magnificence empire has embraced a path just like L’Oreal and LVMH’s. Nevertheless, it plans to protect its 110-year legacy very in a different way—by not passing management of the enterprise on to the subsequent technology.
On the firm’s helm is Marc Puig, who belongs to the founding household’s third technology. He’s been the corporate’s CEO for 20 years and chair since 2007.
A Harvard-educated businessman, Puig has a much less widespread view amongst these belonging to Europe’s outstanding enterprise empires. Succession inside family-run firms is an enormous deal, provided that billions of {dollars} and a wealthy legacy are at stake when a enterprise is handed on from one technology to the subsequent.
Puig as a substitute plans to keep away from any friction totally. It’s not simple operating a enterprise with relations—as Puig places it, it requires “hierarchy and meritocracy.” Members born into the Puig household gained’t robotically get a seat on the desk.
“Difficulties can come up, particularly within the transition between generations—the seek for management, a lack of awareness, a lack of ardour,” he informed the Monetary Instances in an interview final yr.
The Spanish CEO’s resolution? “Self-disempowerment,” he says. At Puig, which means having the next variety of non-family members than these from the household in numerous departments like operations and compensation, he informed the outlet in 2021. He’s additionally intentionally put “troublesome filters” in place, so even relations may have a excessive bar to qualify for positions.
To that finish, three members of the Puig household left its board final month and their roles have been stuffed by impartial administrators.
For now, the corporate solely has two members of the Puig household, each of whom are of their 60s. The board of 13 members has two Puigs—in distinction with firms like LVMH, the place all however one member of the subsequent technology of Arnaults is on the board.
“Generally household companies can lose their place out there. They will begin to die slowly and no one inside the corporate is conscious of it,” Puig stated, including that accountability to buyers will make sure the household enterprise doesn’t crumble from inside.
Within the IPO launching Friday, the Puigs are promoting €1.36 billion value of shares, however will retain its almost 72% stake within the enterprise and 92.5% voting rights, the FT reported. Puig shares have been oversubscribed a number of instances—an indication of sturdy curiosity amongst buyers within the lead-up to its buying and selling.
Puigs’ path
When Antonio Puig launched his import enterprise in 1914, it was by no means meant to be a cosmetics firm. However it closed down after a tragic sinking of one of many firm’s vessels throughout World Conflict I. Antonio pivoted to ship perfumes and finally make them.
When the second-generation Puigs, Antonio and Mariano, took over, the Spanish firm expanded to abroad markets just like the U.Okay. and the U.S. Underneath the third technology, led by Marc and Guide, Puig acquired a collection of firms to bulk up its portfolio of high-end manufacturers, marking the start of Puig as we all know it at present.
Timing is essential
Magnificence manufacturers have been flourishing these days.
Puig owns premium fragrance, make-up and attire manufacturers, which compete with a slew of European luxurious manufacturers. Inside these firms, the efficiency of the wonder segments has stood out. Take LVMH, for example. Sephora, the wonder retail chain it owns, had its best-ever yr in 2023 as folks splurged on premium make-up gadgets.
France’s L’Oreal, the world’s greatest magnificence firm, has additionally benefited from buyers spending extra on its Maybelline mascaras and Garnier serums.
Nonetheless, it may be laborious to foretell how new listings within the client retail realm are obtained. As an illustration, Swiss skincare firm Garderma’s shares surged following its $2.56 billion IPO in March, whereas German magnificence retailer Douglas’s itemizing didn’t carry out as properly.
