Kering Sells Its Beauty Division to L’Oréal for €4 Billion — Plus a 50-Year Gucci License

Just one month after its new CEO took office, French luxury giant Kering Group has made a bold strategic move — selling off its beauty arm to strengthen its core.

On October 19 (local time), Kering announced that it will sell Kering Beauté to L’Oréal Group for €4 billion in cash, a deal expected to close in the first half of 2026.

Under the agreement, L’Oréal will acquire luxury fragrance house Creed and secure a 50-year exclusive license to produce and distribute beauty and fragrance products for Kering’s marquee brands, including Gucci, Bottega Veneta, and Balenciaga. However, since Gucci’s existing beauty license with Coty runs until 2028, L’Oréal will take over that line once the current deal expires.

Industry experts view this acquisition as a sign of the shift from brand-centric to platform-centric luxury management. As high-end groups refocus on creativity and brand equity, they increasingly rely on specialized operators for production and distribution — maximizing profits through licensing and partnerships.

While Kering Beauté’s sales grew steadily, it contributed only 2% of the group’s total revenue. With debts swelling to €9.5 billion and profits declining, new CEO Luca de Meo is clearly steering the company toward a leaner, core-focused strategy. The sale will provide significant liquidity relief while allowing Kering to continue benefiting from long-term beauty royalties.

For L’Oréal, this deal marks a major expansion into the luxury fragrance segment. Following its successful 2008 acquisition of Yves Saint Laurent Beauté, L’Oréal will now strengthen its high-end portfolio alongside Armani, Prada, Valentino, and Maison Margiela.

With the global fragrance market projected to exceed $400 billion by 2025, this acquisition positions L’Oréal to further consolidate its leadership in the premium beauty landscape.