Business Page Writer
By Nonso Agbodi
French luxury giant Kering, parent company of Gucci, has agreed to sell its beauty division to global cosmetics leader L’Oréal for $4.6 billion, marking one of the biggest shake-ups in the luxury and beauty sectors this year.
The transaction includes Kering’s prized fragrance brand Creed as well as a 50-year exclusive licensing agreement that will allow L’Oréal to develop and distribute perfumes, cosmetics, and other beauty products under Kering’s fashion houses such as Gucci, Balenciaga, and Bottega Veneta.
L’Oréal CEO Nicolas Hieronimus hailed the acquisition as a game-changing move:
“Through Creed, we are strengthening our position in luxury fragrances while opening new opportunities in the niche perfume segment.”
The partnership is positioned as a long-term strategic alliance in the luxury beauty and wellness space. While the deal is subject to regulatory approval, both companies expect it to close in the first half of 2026. The licensing rights, however, will only come into effect once Kering’s existing agreement with U.S.-based Coty ends in 2028.
For Kering, the sale comes amid mounting financial pressure. The group, which has a debt load of €9.5 billion, recently reported a 46% drop in net profit for the first half of the year. New CEO Luca de Meo, who took office just weeks ago, described the sale as a “decisive step” toward refocusing on Kering’s core fashion operations and shoring up its balance sheet.
The move not only strengthens L’Oréal’s grip on the global beauty market but also signals a strategic reset for Kering as it pivots back to luxury fashion while easing its debt burden.
