Tom Ford.
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The 61-year-old fashion designer joins the billionaire ranks 17 years after founding his eponymous fashion brand, thanks to a deal that valued his company at $2.8 billion.
Estée Lauder’s agreement to acquire fashion firm Tom Ford appears to have made its founder a new billionaire. The cosmetics giant announced on Tuesday it was purchasing the fashion brand for $2.3 billion in cash and debt, plus $300 million in deferred payments that would be paid out beginning in July 2025. The deal values the company at $2.8 billion, including the $250 million Estée Lauder will receive from Marcolin, the Italian eyewear brand that holds the license for Tom Ford’s line of glasses.
Forbes estimates that Ford, 61, will get about $1.1 billion in cash from the sale, after deducting estimated taxes. (The transaction is expected to close in the first half of 2023.) Ford owned nearly 64% of the company according to a 2013 filing, and he does not appear to have sold any of his stake since then. He also owns at least two homes, including one in Holmby Hills in Los Angeles and another on New York’s Upper East Side, that are worth a collective $65 million. Altogether, Ford is now worth an estimated $1.2 billion. Estée Lauder and Tom Ford did not immediately respond to a request for comment.
Ford isn’t the only one who cashed out in the sale. Italian luxury retailer Zegna held a 15% stake in the company, worth an estimated $345 million (pre-tax). Ford’s longtime business partner Domenico De Sole held just over 11% of the firm, now valued at $259 million (pre-tax). Grupo Americo Amorim, a Portuguese conglomerate founded by the late billionaire “King of Cork” Americo Amorim (d. 2017.), owned the remaining 10%, now worth $230 million before taxes.
Tom Ford reported a $96 million profit on $1.7 billion in sales in 2021, according to the latest annual report filed by publicly traded Zegna, which will retain a long-term license for the brand’s clothing and accessories. Last year marked a turnaround from 2020 and 2019, when the brand posted net losses. Tom Ford has 98 stores in several countries including China, Italy, Japan, Russia, Switzerland and the United Arab Emirates.
Ford will stay on as a “creative visionary” through the end of 2023, according to the statement announcing the deal. “I could not be happier with this acquisition as The Estée Lauder Companies is the ideal home for the brand,” Ford said in the announcement. “They have been an extraordinary partner from the first day of my creation of the company and I am thrilled to see them become the luxury stewards in this next chapter of the Tom Ford brand.”
Born in Austin, Texas, in 1961, Ford grew up in Santa Fe, New Mexico before moving to New York to study art history at NYU. He then transferred to the Parsons School of Design, studying architecture at the university’s campuses in New York and Paris. His interest in fashion reportedly began when he took a year off college to work at the press office of French luxury fashion house Chloé in Paris. After graduation, he got a job working for sportswear designer Cathy Hardwick.
Ford got his first big break in 1990, when he moved to Milan to work as the womenswear designer for Gucci. He quickly rose through the ranks, becoming design director in 1992 and the brand’s creative director in 1994. It was at Gucci that he met his current business partner, Domenico De Sole, then the company’s CEO. In 1995, the pair helped take Gucci public on the Amsterdam and New York stock exchanges.
But the public offering put the company in the crosshairs of fashion titans who smelled an opportunity. In January 1999, Bernard Arnault—the chairman and CEO of luxury conglomerate LVMH, now worth an estimated $176.1 billion—acquired a 5%-plus stake in Gucci. Soon after, Arnault purchased another 9.5% stake from Patrizio Bertelli, the billionaire co-CEO of Prada. By February 1999, LVMH controlled 26.7% of Gucci shares. “The guy just asked himself over to dinner without calling first,” De Sole told Forbes at the time, referring to Arnault.
A month later in March 1999, another French fashion billionaire—François Pinault, the founder of luxury group Kering, now worth an estimated $36.8 billion—bought a 40% stake in Gucci for $3 billion, or $5.4 billion in today’s dollars. That helped Gucci expand and acquire Yves Saint Laurent in 2000, with Ford elevated to the position of creative director for the whole group. But the battle between the two French moguls for control of Gucci continued until 2001, when Pinault purchased half of Arnault’s stake in Gucci for $752 million ($1.3 billion adjusted for inflation) and agreed to buy out the remaining shares in Gucci by 2004.
From 1994—when Ford became Gucci’s creative director—to 2003, Gucci’s sales grew by almost 1,200% to nearly $3 billion. Ford and De Sole oversaw Gucci’s acquisitions of luxury brands including Balenciaga and Bottega Veneta. But Ford left Gucci soon after Pinault completed his takeover in April 2004, reportedly due to disagreements over control of the company.
In March 2005, Ford struck out on his own and established his own brand, with De Sole joining as the new company’s chairman. (He also started a film production company, Fade to Black, and went on to direct and produce the 2009 flick A Single Man, which starred Colin Firth and Julianne Moore and received an Oscar nomination for Firth.) Ford’s first flagship store opened in New York in 2007, the same year he sold a 25% stake in the brand to Grupo Amorim for an undisclosed amount. In 2015, Amorim sold 15% to Zegna, leaving it with 10% of Tom Ford.
Over the years, Ford also made investments in art and real estate: In 2010, he reportedly sold an Andy Warhol self-portrait for $32.6 million. He also owned the 20,662-acre Cerro Pelon Ranch in New Mexico—which served as the filming location for movies including Silverado and Thor—until he sold it for an undisclosed amount in January 2021. Two months later, he also sold a four-story Victorian mansion in the upscale London neighborhood of Chelsea for $17 million.
It’s unclear what the future holds for Ford beyond 2023, when his role at Estée Lauder will end. No matter what he chooses to do, the newly minted billionaire will be flush with cash.