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L’Oréal will take over Kering’s beauty portfolio, including the prestige fragrance maker Creed it acquired in 2023 for $3.8 billion, and the rights to make beauty lines for its fashion house brands, the companies announced on Sunday.
This includes the license to make Gucci beauty when its current agreement with Coty expires, which is believed to be in 2028. The companies will also launch what they have described as a “50-50 joint venture” to explore business opportunities in beauty and wellness.
“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,” Kering chief executive Luca de Meo said in a statement. “This partnership allows us to focus on what defines us best: the creative power and desirability of our houses.”
The Wall Street Journal first reported that a deal was underway on Saturday.
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Under the agreement, L’Oréal will have exclusive rights to make beauty products for both houses and for Gucci under 50 year agreements. It has made fragrances and cosmetics for Yves Saint Laurent since 2008, with particular success in fragrance and complexion products.
With the hope of bringing more of its beauty business in-house, Kering inaugurated a beauty division in 2023 and installed Raffaella Cornaggia in the same year as its head. It also launched perfumes under the Bottega Veneta and Balenciaga brands in 2024 and September respectively; under the new agreement, L’Oréal will own a 50-year exclusive license for both.
But Kering’s efforts to become a multi-sector conglomerate with beauty have sputtered as the complexities of running beauty brands, which have vastly different distribution channels, product launch cadences and customers have weighed on its success. To boot, Kering has been one of the hardest hit of the ongoing luxury slump, with wide losses at Gucci and Alexander McQueen, while its leadership has voiced its discontent with the Gucci beauty line under Coty’s management.
In addition to the $4.6 billion in cash, L’Oréal will also pay royalties to Kering on its licensed brands. The deal is expected to close in the first half of 2026.
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