Estée Lauder is split by succession rift as heirs battle over the troubled beauty brand's future after its shares plunged 50% this year
by: Hani Kamal El-Din
Heirs to the Estée Lauder fortune are battling for the future of the troubled beauty company, after the firm’s shares plunged more than 50 percent this year, according to a new report.
The Lauder family owns roughly 35 percent of the company named for the clan’s matriarch, including supervoting shares that give the heirs roughly 80 percent of the power.
According to the Wall Street Journal, the family is split on its support for current CEO Fabrizio Freda, who is leading a turnaround plan focused on reducing a backlog of unsold inventory.
Leonard, who recently stepped down from the board at age 90, is dissatisfied with Freda, while his 63-year-old son William, who led the company from 2004 to 2009, strongly backs the current CEO, sources told the Journal.
Ronald’s daughter Jane, from the other side of the family, is on a shortlist of internal CEO contenders to replace Freda, some of the people said.
In statements to DailyMail.com, the Lauder family denied any rifts and expressed confidence in Freda, who succeeded William as CEO in 2009.
William, on behalf of the family, said: ‘Together, we have a deep commitment to, passion for and responsibility to the legacy and the future of this company.
‘As we have demonstrated throughout our 77-year history, as a family-controlled company we remain committed and dedicated to ensuring The Estee Lauder Companies continues to grow and thrive for decades to come.