Upset in the Prestige market. The French luxury group Kering and the cosmetics giant L’Oréal have formalized an exclusive 50-year license agreement for the creation, development, and global distribution of Gucci fragrances and beauty products.
This historic agreement comes after a three-way pact was reached, accelerating the brand's strategic transition. Originally set for 2028, Kering and Coty have agreed to move forward the amortization date of the current license to June 30, 2027. In consideration for the early termination of these rights, Coty will receive approximately 400 million dollars, a cash flow that the American company will receive between 2026 (250 million) and 2027 (up to 150 million), in addition to the transfer of selected inventories. L'Oréal will assume 70% of these transition costs and inventories.
The integration of Gucci Beauty into L'Oréal's luxury division responds to the strategic macro-alliance forged between Kering and the group led by Nicolas Hieronimus at the end of 2025 (which already included licenses for brands such as Balenciaga and Bottega Veneta after the acquisition of the high perfumery house Creed).
"Welcoming Gucci Beauty to L'Oréal Luxe a year early is truly exciting," said Nicolas Hieronimus, CEO of L’Oréal. "It's the beginning of a 50-year journey, a very significant additional growth driver for our company and a new milestone in our partnership with Kering."
For his part, Cyril Chapuy, president of L’Oréal Luxe, emphasized the strategic fit of the Italian brand in their portfolio, defining Gucci as a "cultural powerhouse" with which they intend to build a massive business division: "By merging Gucci's radical avant-garde with our global development engine, we are poised to build a new multi-billion euro brand."
Kering accelerates its control over the beauty axis
For Kering, disassociating early from Coty and unifying its cosmetics business under the L'Oréal umbrella seeks to ensure much faster and stronger global brand consistency in terms of geography and generational handover. Furthermore, the agreement mutually resolves all pending disputes and claims that existed between Kering and Coty regarding the license rights.
Luca de Meo, CEO of Kering, has stated that this move "generates value for all parties" by allowing the design of the next chapter of Gucci Beauty a year earlier than planned.
Financial impact for Coty
Despite losing one of its flagship brands in the luxury division, Coty sees the agreement as an opportunity for immediate financial flexibility. Markus Strobel, executive and interim president of Coty, has stated that the pact "offers a favorable outcome that recognizes the substantial value created in Gucci Beauty under our management and allows us to reallocate capital and focus on our priority brands".
The luxury perfumery industry is closely watching this long-term (half a century) move, which confirms the trend of large conglomerates to ensure the stability of their fashion brands in the cosmetic field through unprecedented shielding contracts