In a bold, (expensive) move set to reshape the luxury beauty landscape, L’Oréal and Kering have announced a long-term strategic partnership valued at €4 billion (A$6.5 billion) — marking L’Oréal’s largest deal to date, eclipsing its 2023 US$2.5 billion (A$3.9 billion) acquisition of Aesop.
The far-reaching agreement includes L’Oréal’s acquisition of The House of Creed, 50-year exclusive beauty and fragrance licences for Gucci, Bottega Veneta and Balenciaga, and an exclusive 50/50 joint venture to explore business opportunities in wellness and longevity.
Building on the long-standing success of Yves Saint Laurent Beauté, this alliance cements the historic collaboration between two global leaders with complementary strengths — Kering’s portfolio of iconic luxury Houses and L’Oréal’s world-class beauty expertise. Together, they aim to accelerate growth across high-potential categories and unlock considerable long-term value.
Under the agreement, L’Oréal will take over Gucci’s beauty and fragrance licence once Kering’s current arrangement with Coty expires. New 50-year licences for Bottega Veneta and Balenciaga will also commence upon closing of the transaction, expected in the first half of 2026.
A strategic committee will be established to ensure close coordination between the two groups, preserving the creative identity of Kering’s Houses while maximising L’Oréal’s leadership in luxury beauty.
Under the terms of the deal, Kering has the right to sell Kering Beauté, including The House of Creed, to L’Oréal. A heritage name in haute parfumerie, Creed stands among the world’s leading luxury fragrance Houses, celebrated for its craftsmanship and mastery of rare natural ingredients.
As part of L’Oréal Luxe, Creed will be positioned to accelerate its global growth across both men’s and women’s markets — leveraging L’Oréal’s scale, research capabilities and global distribution network.
Beyond beauty, Kering and L’Oréal will join forces in a planned 50/50 joint venture designed to explore opportunities at the intersection of luxury, wellness and longevity. The initiative will combine L’Oréal’s innovation and R&D power with Kering’s deep understanding of high-end consumers to develop cutting-edge wellness experiences and services that redefine the future of luxury living.
The agreement — which includes the sale of Creed, the transfer of Kering Beauté, and the creation of 50-year licences for Gucci, Bottega Veneta and Balenciaga — is valued at €4 billion (A$6.5 billion), payable in cash at closing, with ongoing royalties to be paid by L’Oréal for use of the licensed brands.
“This strategic alliance marks a decisive step for Kering,” said Luca de Meo, CEO of Kering. “Joining forces with the global leader in beauty, we will accelerate the development of fragrance and cosmetics for our major Houses, allowing them to achieve scale in this category and unlock their immense long-term potential, as did Yves Saint Laurent Beauté under L’Oréal’s stewardship. Together, we will also venture into new frontiers of wellness, combining the unrivalled expertise of L’Oréal with our unique luxury reach. This partnership allows us to focus on what defines us best: the creative power and desirability of our Houses.”
Nicolas Hieronimus, CEO of L’Oréal Groupe, added: “I am delighted to forge this long-term strategic alliance with one of the world’s most prestigious, creative and visionary luxury groups. This partnership will further solidify our position as the world’s #1 luxury beauty company and allow us to explore new avenues in wellness together. The addition of these extraordinary brands perfectly complements our existing portfolio and significantly expands our reach into new, dynamic segments of luxury beauty. Through Creed, we will establish ourselves as one of the leading players in the fast-growing niche fragrance market. Gucci, Bottega Veneta and Balenciaga are all exceptional couture brands with enormous potential for growth.”
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