L’Oréal seals €4bn deal for Kering’s entire luxury beauty portfolio

L’Oréal and Kering announced a strategic alliance on Sunday that will see the French cosmetics giant acquire Kering’s premium beauty business for €4 billion.

The deal means that L'Oréal will enter into 50-year licensing arrangements for some of Kering’s most iconic brands, specifically Gucci, Bottega Veneta, and Balenciaga.

L'Oréal will also take over Kering's fragrance line Creed.

“Joining forces with the global leader in beauty, we will accelerate the development of fragrances and cosmetics for our major Houses, allowing them to achieve scale in this category and unlock their immense long-term potential,” said Kering’s newly appointed chief executive Luca de Meo.

“Together, we will also venture into new frontiers of wellness, combining the unrivalled expertise of L’Oréal with our unique luxury reach,” Meo added.

Kering is a Paris-based luxury group best known for the high-fashion and leather-goods houses under its wing, including Gucci, Saint Laurent, Bottega Veneta, Balenciaga and Alexander McQueen.

Through these brands, along with Kering Eyewear, the company generates most of its €17.2bn in annual revenue from handbags, footwear, ready-to-wear and accessories.

Controlled by the Pinault family holding company Artémis, Kering has been under pressure to revive growth at Gucci, its largest label.

L’Oréal, by contrast, is a pure-play giant — focused exclusively on beauty products — with €43.48bn in 2024 sales.

The French group sells cosmetics, skincare, haircare, and fragrances across four main divisions — Consumer Products, L’Oréal Luxe, Professional Products and Dermatological Beauty. With vast global production and distribution networks, L’Oréal operates many brands end to end while also managing luxury beauty licences for fashion houses.

The deal announced on Sunday cements L’Oréal’s dominance in luxury beauty while allowing Kering to cut debt and refocus on its core businesses. Kering's debt came to €9.5bn at the end of June, on top of €6bn in long-term lease liabilities.

“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," said L’Oréal’s chief executive Nicolas Hieronimus.

"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.”

What makes the agreement particularly noteworthy is its dual structure. Not only does L’Oréal take stewardship of beauty and fragrance development for Kering’s luxury brands, but the two groups will also establish an exclusive 50/50 joint venture to explore business opportunities in wellness and longevity — areas increasingly intersecting with high-end beauty.