French luxury powerhouse Kering has agreed to sell its entire beauty division — including the prestigious Creed perfume brand — to cosmetics giant L’Oréal in a landmark deal valued at $4.6 billion.
The transaction, announced Sunday, marks a sweeping reshuffle in France’s luxury sector and signals Kering’s bid to tackle its mounting €9.5 billion debt load. Under the agreement, L’Oréal will also secure 50-year exclusive global licences to produce and distribute beauty products for Kering’s fashion houses Gucci, Bottega Veneta, and Balenciaga once their current deal with U.S. firm Coty expires in 2028.
Both companies described the move as the beginning of a “long-term strategic partnership in luxury beauty and wellness,” positioning L’Oréal to expand its dominance in the premium fragrance space.
“Through Creed, we will establish ourselves as one of the leading players in the fast-growing niche fragrance market,” said Nicolas Hieronimus, L’Oréal’s chief executive, in a joint statement.
Regulatory approval is still pending, with payment expected to be completed in the first half of 2026.
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For Kering, which reported a 46 percent drop in net profit to €474 million and a 16 percent revenue slump to €7.6 billion in the first half of the year, the sale represents a decisive attempt to stabilise its balance sheet and sharpen focus on core fashion operations.
Newly appointed chief executive Luca de Meo, who took charge barely a month ago, hailed the divestment as a turning point. “This transaction marks a decisive step for Kering,” he said, underscoring his mandate to streamline the group’s structure and restore investor confidence after a turbulent financial stretch.
The deal also reinforces L’Oréal’s push deeper into ultra-luxury beauty — a segment that has shown strong resilience despite global economic uncertainty — and positions the company to challenge rivals like Estée Lauder in the niche fragrance market.