The Estée Lauder Companies to Acquire Too Faced

Innovative, iconic makeup brand beloved by consumers adds another
strategic and powerful engine of growth to the Company, while further
diversifying its portfolio

NEW YORK–(BUSINESS WIRE)–The
Estée Lauder Companies Inc. (NYSE:EL) announced today that it has
signed an agreement to acquire Too Faced, the feminine, playful makeup
brand renowned for high-quality, stylish cosmetics that consumers love.
Too Faced, one of the fastest growing makeup brands in specialty-multi
and online, is expected to strengthen the Company’s leadership position
in the fast-growing prestige makeup category globally, increase the
Company’s consumer reach in the specialty-multi channel, and win with
millennials – all in strong alignment with the Company’s strategy.

Launched in 1998 by cosmetics visionaries Jerrod Blandino and Jeremy
Johnson, and currently led by Johnson, Blandino and CEO Eric Hohl, Too
Faced offers an unabashedly empowering line of cosmetic products for the
eyes, face and lips. Beloved for its high-quality, innovative formulas,
irreverent product names and distinctive packaging, Too Faced creates an
emotional, authentic connection with consumers and has developed a
strong following and built a vibrant community among millennials who are
passionate about social media, fashion and pop culture. Too Faced has
over 7.3 million Instagram followers and is among the top eight makeup
brands in the specialty-multi channel in the United States.

Too Faced has experienced impressive growth over the past several years,
and is expected to reach more than $270 million in net sales in 2016.
This represents growth of more than 70% for the year and 60% compounded
annually over the past three years. Too Faced has been part of leading
global growth equity firm General Atlantic’s portfolio since 2015. The
Estée Lauder Companies has agreed to acquire the entities that own the
brand for a purchase price of approximately $1.45 billion. The
acquisition is expected to close in December 2016.

“Too Faced is one of the most dynamic makeup brands in the world,” said
Fabrizio Freda, President and Chief Executive Officer of The Estée
Lauder Companies. “It has tremendous growth momentum in specialty-multi
and online – important, strategic and fast-growing channels. With Too
Faced, we see terrific opportunity for additional value creation through
expansion in new and existing markets both in the U.S. and
internationally, as well as in travel retail globally. Jeremy, Jerrod,
Eric and the entire Too Faced team have built an amazing and innovative
brand. We look forward to working with them to continue to build on the
brand’s winning spirit.”

“We are delighted to be joining forces with The Estée Lauder Companies
as we continue to drive Too Faced’s dynamic growth,” said Jeremy Johnson
and Jerrod Blandino, Co-Founders of Too Faced. “We started our careers
behind the counters of the Estée Lauder brand, so this is truly a
‘homecoming’ for us. The Estée Lauder Companies appreciates our unique
vision – to provide innovative, cruelty-free makeup products that give
women the confidence to ‘have fun, play and dream big’ – and is
committed to ensuring that we retain and build on the core pillars of
our brand that are so important to us and our fans. This commitment,
combined with ELC’s incredible world-class resources, will help us
assure the ongoing growth and success of Too Faced for many years to
come.”

Too Faced’s diverse range of color cosmetics includes cult favorites
across all makeup subcategories. The iconic Better Than Sex Mascara,
which launched in 2013, quickly became the number one selling mascara
with all of the brand’s primary retail partners in multiple markets, and
has sold over 2.5 million units globally. Born This Way, the brand’s
coveted undetectable foundation that launched in July 2015, has also
become one of the bestselling foundations within its channels of
distribution. Too Faced is also known for its unique and beautifully
packaged eye shadow palettes and collections, which strategically
combine bestsellers with new creations; for example, the brand’s
Christmas Collection has become a hero franchise that is significantly
reinvented every year, driving its phenomenal success.

“The entrepreneurial spirit at the heart of The Estée Lauder Companies
is evident in the remarkable success of Too Faced,” said William P.
Lauder, Executive Chairman of The Estée Lauder Companies. “Jerrod and
Jeremy started the brand with a simple, yet compelling creative concept,
and transformed it into something that is truly extraordinary. We are
absolutely delighted that Jeremy and Jerrod are ‘returning’ to the
Company where they began their careers in beauty, and we welcome the
entire Too Faced team to our family.”

“Too Faced is a terrific growth company with an impressive track record
of successful product innovation and an authentic connection with its
customers. We’ve enjoyed a strong partnership with Jeremy, Jerrod, Eric
and the rest of the Too Faced team and believe the company’s bright
future will only be enhanced as part of The Estée Lauder Companies’
portfolio,” said Andrew Crawford, Managing Director and Global Head of
Retail & Consumer at General Atlantic.

John Demsey, Executive Group President, The Estée Lauder
Companies Inc., will add Too Faced to the portfolio of brands that he
oversees.

The Estée Lauder Companies Inc. received financial advice from Evercore
and BNP Paribas, and legal counsel from Lowenstein Sandler LLP. Too
Faced received financial advice from Goldman, Sachs & Co. and Jefferies
LLC, and legal counsel from Paul, Weiss, Rifkind, Wharton & Garrison LLP.

Conference Call

The Estée Lauder Companies will host a conference call from 8:00 a.m. to
8:30 a.m. (ET) tomorrow, November 15, 2016 to discuss this transaction.
The dial-in number for the call is 888-294-4716 in the U.S. or
706-902-0101 internationally (conference ID number: 20656069). The call
will also be webcast live at http://www.elcompanies.com/investors/events-and-presentations.

The forward-looking statements in this press release, including those in
the quoted remarks and those relating to the expectations for the
acquired brand and the benefits of the acquisition, involve risks and
uncertainties. Factors that could cause actual results to differ
materially from those forward-looking statements include current
economic and other conditions in the global marketplace, actions by
retailers, suppliers and consumers, competition, the Company’s ability
to successfully integrate the acquired business and/or implement its
long-term strategic plan, and those described in the Company’s annual
report on Form 10-K for the year ended June 30, 2016.

About The Estée Lauder Companies Inc.

The
Estée 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 150
countries and territories under brand names including: Estée Lauder,
Aramis, Clinique, Prescriptives, Lab Series, Origins, Tommy Hilfiger,
M·A·C, Kiton, La Mer, Bobbi Brown, Donna Karan New York, DKNY, Aveda, Jo
Malone London, Bumble and bumble, Michael Kors, Darphin, Tom Ford,
Smashbox, Ermenegildo Zegna, AERIN, Tory Burch, RODIN olio lusso, Le
Labo, Editions de Parfums Frédéric Malle, GLAMGLOW, By Kilian and BECCA.

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Contacts

Estée Lauder
Investor Relations:
Dennis
D’Andrea, 212-572-4384
or
Media Relations:
Jill
Marvin, 212-572-4438