Kering to sell beauty business to L’Oreal
Gucci owner Kering has entered into a strategic partnership with L’Oréal, which includes the sale of its beauty business as part of a long-term collaboration.
Valued at €4 billion, the agreement includes the acquisition of the House of Creed by L’Oréal, the beauty and fragrance licenses of Houses of Kering, and an exclusive venture to “explore business opportunities in the field of wellness and longevity”.
Kering stated that the partnership grants the right to enter into a 50-year exclusive license for the creation, development and distribution of Gucci fragrance and beauty products after its current agreement with Coty expires.
The company will also grant L’Oréal 50-year exclusive licenses for the creation, development and distribution of fragrance and beauty products for Bottega Veneta and Balenciaga.
Subscribe to TRBA strategic committee will be established to ensure coordination between Kering brands and L’Oréal and to monitor the progress of the partnership.
Luca de Meo, chief executive of Kering, said: “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.
“Together, we will also venture into new frontiers of wellness, combining the unrivalled expertise of L’Oréal with our unique luxury reach. This partnership allows us to focus on what defines us best: the creative power and desirability of our houses.”
Nicolas Hieronimus, chief executive of L’Oréal Groupe, said: “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.
“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.”
