L’Oréal acquires Kering Beauté – new alliance in the luxury beauty segment. L’Oréal acquires Kering Beauté, including the fragrance house Creed. Long-term agreement concluded for beauty and fragrance licences for the Kering brands Gucci, Bottega Veneta and Balenciaga. Joint venture to develop new business areas. Total value of the agreement amounts to €4 billion.
L’Oréal acquires Kering Beauté – new alliance in the luxury beauty segment
Luxury goods groups Kering and L’Oréal have announced a far-reaching strategic partnership in the luxury beauty and wellness sector. The agreement includes the acquisition of the fragrance house Creed by L’Oréal, the granting of beauty and fragrance licences for the Kering brands Gucci, Bottega Veneta and Balenciaga, and an exclusive joint venture to develop new business areas in the field of wellness and longevity. The agreement is expected to take effect in the first half of 2026 and marks a significant step for the industry.
L’Oréal acquires Kering Beauté, including the fragrance house Creed
The alliance builds on the existing collaboration within Yves Saint Laurent Beauté and aims to accelerate the growth of both companies in high-potential categories. Kering grants L’Oréal the right to acquire Kering Beauté, including the fragrance house Creed. Creed, known for its artisanal quality and use of rare natural ingredients, will continue to drive its global expansion in the women’s and men’s markets under the L’Oréal Luxe umbrella.
Long-term exclusive licences for Gucci, Bottega Veneta and Balenciaga
Long-term exclusive licences are a key component of the partnership. L’Oréal will receive a 50-year exclusive licence to create, develop and distribute fragrance and beauty products for Gucci. This licence will take effect upon expiry of the current agreement with Coty. In addition, L’Oréal will be granted 50-year exclusive licences for Bottega Veneta and Balenciaga, which will commence upon completion of the transaction. A strategic committee will be established to coordinate and monitor progress.
Total value of the agreement amounts to €4 billion
The total value of the agreement, including the sale of Creed and the licensing agreements, amounts to €4 billion, which will be paid in cash upon completion. L’Oréal will also pay royalties to Kering for the use of the licensed brands.
Beyond the traditional beauty segment, Kering and L’Oréal plan to establish a 50/50 joint venture. The aim is to explore business opportunities at the intersection of luxury, wellness and longevity. By combining L’Oréal’s innovative strength and Kering’s deep understanding of luxury customers, the aim is to develop innovative experiences and services.
L’Oréal acquires Kering Beauté – statements from company management
Luca de Meo, CEO of Kering, described the strategic alliance as a decisive step for Kering. He emphasised that the collaboration with the global beauty market leader would accelerate the development of fragrances and cosmetics for Kering’s brands and unlock their long-term potential. In addition, the two companies would break new ground in the wellness sector.
Nicolas Hieronimus, CEO of the L’Oréal Group, emphasised that the partnership would consolidate L’Oréal’s position as the world’s leading luxury beauty company and open up new avenues in the wellness sector. The integration of the Creed, Gucci, Bottega Veneta and Balenciaga brands will complement the existing portfolio and expand its reach into dynamic segments of the luxury beauty market. Creed in particular will make L’Oréal a leading player in the rapidly growing niche fragrance market.
L’Oréal acquires Kering Beauté – a response to changing market conditions
The strategic alliance between Kering and L’Oréal can be interpreted as a response to changing market conditions and a proactive step to secure future competitive advantages. For Kering, it offers an opportunity to focus and generate revenue from an outsourced business. For L’Oréal, it represents a significant expansion of its luxury portfolio and a strengthening of its market leadership, particularly in growing segments such as niche fragrances and the emerging wellness market. The combination of their respective strengths could significantly influence the development of the luxury beauty industry in the coming years.
The agreement is subject to customary business conditions, including regulatory approvals and Kering’s obligations under French labour law.
Sources:
https://www.kering.com/en/news/kering-and-l-oreal-forge-an-alliance-in-beauty-and-wellness
[Text: epcnews/Images: LOreal/Kering]