Kering sells beauty business to L'Oreal for €4 billion

Kering SA on Sunday said it will sell its beauty division to L'Oreal SA under the terms of a binding agreement that aims to develop a long-term strategic partnership focused on luxury beauty and wellness.

Kering, a Paris-based luxury goods company and owner of the Gucci fashion house, said the deal with the Paris-based personal care company is expected to close in the first half of 2026 and is valued at EUR4 billion in cash.

The transaction will result in the sale of the Kering Beaute division to L'Oreal, which includes the House of Creed perfume business.

L'Oreal will also pay royalty payments to Kering, after being granted a 50-year exclusive license to create, develop, and sell fragrances and beauty products for Gucci, once an existing license with New York-based Coty Inc has concluded.

Meanwhile, a comparable 50-year agreement relating to the Bottega Veneta and Balenciaga brands will start straight away.

L'Oreal Chief Executive Officer Nicolas Hieronimus said: "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."

Kering and L’Oreal said they will further explore business opportunities across luxury, wellness, and longevity.

"This exclusive partnership, in the form of a planned 50/50 joint venture, will craft cutting-edge experiences and services combining L’Oreal’s innovation capabilities with Kering’s deep understanding of luxury clients," Kering commented.

A strategic committee will be established to coordinate and monitor the progress of their latest collaborative efforts, which builds upon previous cooperation through the Yves Saint Laurent Beaute brand.

The deal remains subject to customary terms and conditions alongside other regulatory approvals.