US-based personal care manufacturer and retailer Estée Lauder and Spanish beauty group Puig are in late-stage talks about a merger that would combine two family-controlled businesses.

Citing sources, a Bloomberg report said the companies are discussing a transaction that would be largely paid in shares and could be announced within weeks.

However, negotiations are still in progress, with no final agreement reached, and there remains the possibility that talks could break down or timelines may shift.

Both companies confirmed on 23 March that they were engaged in discussions regarding a potential business combination, without providing further details.

At the time, Estée Lauder said it was “discussions regarding a potential business combination with Puig, in which the two companies would potentially merge their businesses”.

The talks come amid broader consolidation across the consumer and retail sectors, as companies navigate supply chain challenges, geopolitical uncertainty, inflationary pressures and changing consumer behaviour.

As part of the proposed transaction, Puig executive chairman Marc Puig is expected to join the board of the combined entity and take on a central role in overseeing integration.

His involvement is viewed as supporting continuity and aiding execution.

Puig stepped down as CEO last month to focus on mergers and acquisitions.

Estée Lauder is undergoing a turnaround under CEO Stéphane de La Faverie, including a stronger focus on faster-growing online channels such as Amazon.

A representative for Estée Lauder did not immediately comment, while a spokesperson for Puig declined to comment to Bloomberg.

The potential deal would be significant in scale, with Puig valued at €9.8bn ($11bn) and Estée Lauder at around $27bn.