L'Oréal is getting even stronger in the premium cosmetics and beauty sector. The French group has made official the purchase of the strategic alliance with Kering, and it is now official: L'Oréal acquires Kering's premium beauty business for 4 billion euros.
Kering is thus ceding the 50-year license for some of its most emblematic and representative brands, such as Gucci, Bottega Veneta, and Balenciaga. Not only that, L'Oréal, from now on, also owns the fragrance line of the symbolic luxury firm Creed. These licenses transfer the creation, development, and distribution of perfumery and beauty products to LOréal. In the case of Gucci, this license will become effective when the contract with Coty ends. For the remaining brands, this operation is expected to be effective during the first six months of 2026.
As noted by elEconomista.es, the Kering beauty group is going through a delicate situation marked by debt, and this is the first divestment by CEO Luca de Meo.
The figures of the agreement, in this case, have been revealed: 4 billion euros. The payment method, too: it will be paid in cash at the time the transaction is carried out, and L'Oréal will pay royalties to Kering for the use of licensed brands, as reported by various economic media outlets.
For his part, Luca de Meo, explained that "this strategic alliance marks a decisive stage. We will considerably accelerate the development of fragrances and cosmetics for our major brands, allowing them to reach a critical size in this category and unlock their immense long-term potential."
This represents a radical shift in their strategy. In February of last year, 2023, Kering created a division for premium beauty: "Beauté." The objective of creating this area was to lead the launch of a cosmetics line for Balenciaga, Bottega Veneta, Alexander McQueen, and other of its recognized brands within premium cosmetics. At that time, the firm stated that this was a move that, in the long term, "could create value for both the group and the brands, building each its own identity and constructing for each brand a coherent strategy and positioning in the market."