The company said that Freda, who has worked in the health and beauty arena for over 20 years, has been appointed as chief operating officer effective from March of next year and is expected to succeed to the position of chief executive officer.
"I also anticipate that Fabrizio will succeed me as CEO within 24 months," said current CEO William Lauder at the company's annual general meeting in New York on Friday.
Freda's has worked his way up to president of global snacks at P&G, but has spent most of his career working in the personal care domain, including a key marketing position with Gucci.
The new appointment was backed up by the announcement that Dan Brestle will become vice chairman and president for Estee Lauder's North American operations, where he will be called upon to give the division a more 'cohesive' leadership.
Although recent quarterly results showed that the company had enjoyed healthy sales growth in international markets, the US market has continued to prove disappointing, hampered by a less than dynamic product portfolio in an over saturated market.
The company recently announced a 4.9 per cent growth in its first quarter sales, which came in at $1.71bn, but said that net profits for the period fell by 27 per cent to $77.9m, mainly as a result of the poor performance in the mainstay US market.
However, the new appointment could spell the start of a turn around for the company, as the new leadership is expected to give the player renewed dynamism, as well as the possibility of stronger ties with P&G.
Indeed, the Freda's appointment was well received by the financial world when it was announced on Friday, leading share prices to jump by more than $3, to close at $44.17.
Undoubtedly the appointment will also fuel further speculation over a potential take-over by P&G, a move which would allow the troubled Estee Lauder to benefit from a much needed cash injection.
