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French cosmetics giant L’Oreal announced Sunday that it will acquire Kering’s beauty division, including its high-end perfume brand Creed, for $4.6 billion.
The companies described the agreement as a "long-term strategic partnership in luxury beauty and wellness," among the biggest fragrance deals in recent years.
The acquisition gives L’Oreal control of Creed, a perfume house renowned for its artisanal fragrances and loyal global customer base. The company said the purchase will strengthen its presence in the fast-growing niche perfume segment, which caters to consumers seeking exclusive, handcrafted scents.
"Through Creed, we will establish ourselves as one of the leading players in the fast-growing niche fragrance market," said L’Oreal CEO Nicolas Hieronimus in a joint statement with Kering.
The deal also grants L’Oreal 50-year exclusive licenses to develop and distribute beauty and personal care products under Kering’s top fashion houses—Gucci, Bottega Veneta, and Balenciaga—once their current agreement with American beauty group Coty expires in 2028.
Under the new arrangement, L’Oreal will be responsible for future beauty launches and brand extensions tied to these luxury labels, giving it long-term control over some of the world’s most recognizable fashion names in the beauty market.
The deal comes as Kering, the parent company of fashion houses including Saint Laurent and Gucci, faces declining profits and seeks to reduce its €9.5 billion ($11 billion) debt amid a broader slowdown in global luxury demand. In July, the group reported a 46% drop in first-half net profit to €474 million and a 16% decline in revenue to €7.6 billion.
Kering’s new CEO, Luca de Meo, who took office last month, described the sale as a "decisive step for Kering." He said the partnership with L’Oreal would help strengthen the company’s financial structure and support its focus on core fashion and accessories. "Joining forces with the global leader in beauty, we will accelerate the development of fragrance and cosmetics for our major Houses," de Meo said.
L’Oreal CEO Nicolas Hieronimus called the partnership "a long-term strategic alliance with one of the world’s most prestigious, creative and visionary luxury groups." He said the deal would strengthen L’Oreal’s leadership in the global beauty sector and expand its reach into new segments of high-end cosmetics and fragrances. "This partnership will further solidify our position as the world’s No. 1 luxury beauty company," Hieronimus said. "Through Creed, we will establish ourselves as one of the leading players in the fast-growing niche fragrance market."
The transaction remains subject to regulatory approval, with payment expected to be completed in the first half of 2026.
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