Puig and Estée Lauder: it was to be expected

When I read that Puig and Estée Lauder were interrupting merger talks, I wasn't surprised. I don't have inside information. Call it intuition. Or memory. But, from what I knew of the company, I never quite saw clearly that it could work out. And, in a way, the news made me happy.I explain it from three perspectives.The first is personal. My first job was at Antonio Puig. It was 1991. The offices were on Travessera de Gràcia. The first day, don Mariano Puig received me. When years later I left, it was also he who said goodbye to me. Marc Puig had his office two or three doors from mine. In marketing, we were barely a dozen people. We often went to the factory on Potosí street. There I learned a great deal. The family delegated and gave people a huge amount of freedom.But, above all, I saw a family business in the deepest sense of the term. Not as a synonym for small, but for responsibility. For lived ownership. For commitment to the long term. For a way of understanding the business that did not entirely separate the surname, the project, and the country.I understand that family companies change. Branches multiply. Generations succeed each other. Management becomes complicated. Sometimes a moment comes when selling, merging, or diluting control seems reasonable. But, at least the Puig I knew, was not a Puig designed to lose command. It was not imaginable. It was not part of its culture.The second plan is for the country. Puig is listed on the stock exchange, yes, but it continues to be controlled by a Catalan family. The family retains around three-quarters of the capital and more than 90% of the voting rights. Companies with their decision-making center here generate rootedness, suppliers, talent, sponsorships, taxation, presence.In an operation with Estée Lauder, by relative dimension, it was difficult to think that real control would not end up shifting. Perhaps not on the first day. Perhaps not in the first board meeting. But these things happen slowly. First structures are shared. Then functions are rationalized. Later decisions are transferred. And one day you discover that a company from here no longer fully decides from here. We would have lost a part of Puig's Catalan identity.The third plan is economic. It was not a merger of equals. Estée Lauder invoices more than double Puig, but loses almost a billion when Puig earns 600 million. Valuations are very difficult.Be that as it may, Puig continues to be a great company. A company that began selling colognes and soaps, door-to-door, in a Seat 600 on the roads of Spain, and which has managed to become a global multinational in luxury, perfumery, fashion, and beauty.There aren't so many stories like this. They must be taken care of.