Beauty conglomerates frequently engage in acquisitions, but most have little impact. On March 31, 2026, L’Oréal and Kering completed a significant transaction—a €4 billion cash deal transferring the House of Creed to L’Oréal, along with 50-year exclusive licenses for Bottega Veneta and Balenciaga fragrance and beauty products. This deal, first announced in October 2025, has now cleared regulatory hurdles, with the industry’s attention focused on the next steps.
This acquisition outpaces L’Oréal’s 2023 purchase of Aesop for $2.5 billion, marking it as the largest in the company’s history. The substantial price underscores the seriousness with which both parties view this opportunity. However, the most intriguing aspect is the 50-year term of the licensing agreements, indicating a long-term commitment to building enduring value beyond the lifetimes of the signatories.
What L’Oréal Actually Gets
Must Read: Kering and L’Oréal Finalize Acquisition, Fenty Beauty Partners with WhatsApp https://t.co/jwojHi7jzt
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The primary asset in this deal is the House of Creed, a leading luxury fragrance brand. Its inclusion grants L’Oréal immediate prestige in the high-end fragrance market. The challenge lies in managing rather than building the brand, a task that requires careful stewardship.
In addition to Creed, L’Oréal gains 50-year exclusive licenses to create, develop, and distribute beauty and fragrance products under the Balenciaga and Bottega Veneta brands. Both brands hold significant cultural influence, with Balenciaga expanding its fragrance presence and Bottega Veneta’s quiet luxury seamlessly transitioning into the beauty sector.
L’Oréal also secures a 50-year exclusive license for Gucci, effective upon the expiration of Gucci’s current agreement with Coty. This move represents a long-term investment in realizing Gucci’s full beauty potential.
The deal is structured as a cash transaction, with ongoing royalty payments from L’Oréal to Kering.
Why L’Oréal Wanted This
The acquisition aligns with L’Oréal’s strategic vision. Its success in growing the Yves Saint Laurent beauty business from €649 million to €2 billion over two decades serves as a testament to its capability in transforming fashion house beauty licenses into substantial businesses. This history supports the case for placing Balenciaga, Bottega Veneta, and Gucci under L’Oréal’s umbrella.
L’Oréal Group CEO Nicolas Hieronimus highlighted the deal as a pivotal moment for the company’s standing in both beauty and luxury beauty markets: “We will now work together, over the next fifty years, to write the next chapter of these iconic brands, to unlock their immense growth potential.” The emphasis on a 50-year plan indicates a strategic focus on long-term brand positioning rather than short-term gains.
Why Kering Was Willing to Sell
Kering faced a 13% revenue decline in its 2025 annual results, influencing its decision to sell. Monetizing Kering Beauté provides essential capital and allows its fashion brands’ beauty divisions to be managed by experts focused solely on beauty.
Kering CEO Luca de Meo described this transaction as initiating “a new phase of acceleration” for its brands, enhancing their potential in fragrances and cosmetics by leveraging L’Oréal’s global infrastructure.
This honest assessment acknowledges that running a large-scale global beauty operation demands expertise that even a substantial fashion conglomerate like Kering might not possess as deeply as a dedicated beauty company.
The Wellness and Longevity Angle
A significant aspect of this deal is the potential joint venture on wellness and longevity, an area experiencing rapid growth in luxury consumer spending. Kering offers fashion credibility, while L’Oréal provides scientific expertise, making them well-equipped to explore this sector.
Though details are scarce, the mention of this initiative alongside a $4.6 billion deal indicates its importance beyond a mere gesture. This development is worth monitoring.
The luxury beauty sector has been evolving over time. L’Oréal’s acquisition of Kering Beauté is a significant step in this trend, highlighting where significant investments in beauty are heading and identifying potential leaders. With 22 research centers across seven regional hubs and a team of over 4,000 scientists, L’Oréal is well-prepared to fulfill its commitments. The next fifty years for Balenciaga, Bottega Veneta, and Gucci beauty now lie with L’Oréal.
Featured image: Jakub Porzycki/Getty Images
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