By
Bloomberg
Published
October 20, 2025
L’Oreal SA’s €4 billion ($4.7 billion) buy of Kering SA’s magnificence enterprise marks the most important in a string of current offers by the French cosmetics group, because it builds out its vary of luxury brands.
The acquisition confirmed the proprietor of Maybelline and Lancôme is keen to pounce when prized property are up for grabs at a beautiful worth. Creed’s valuation was decrease within the deal than the €3.5 billion Kering paid for it in 2023, an individual acquainted with the talks stated, declining to say by how a lot.
L’Oreal Chairman Jean-Paul Agon approached Kering’s then CEO Francois-Henri Pinault up to now yr about hanging a magnificence deal, folks acquainted with the transaction stated. Pinault continues to be chairman of Kering however was changed as CEO final month by Luca de Meo. The talks accelerated in September, one individual stated.
The all-cash buy was billed as a magnificence and wellness partnership between Kering, the proprietor of Gucci, and L’Oreal. Beyond Creed, L’Oreal can even get 50-year licenses to develop and market magnificence choices for Kering’s trend brands, together with Bottega Veneta, Balenciaga and finally Gucci — as soon as that license is free of its partnership with Coty Inc.
The Gucci license is ready to change into accessible in 2028 on the newest, in accordance to the deal phrases, folks acquainted stated.
Berenberg analysts led by Nick Anderson estimate Creed is being valued at €2.5 billion within the sale, implying a writedown of round €1 billion on the 2023 buy worth, they stated Monday in a word. They estimate the Gucci license is price €1.5 billion.
The deal “comes at a price, namely a one-third write-down of an asset bought just two years ago,” the analysts stated.
Kering buyers nonetheless welcomed the deal, sending shares as a lot as 5.5% increased in Paris. With the sale, leverage will come down shut to 1.5 occasions earnings earlier than curiosity, tax, depreciation and amortization from 2.3 occasions on the finish of final yr, in accordance to estimates by Banco Santander SA.
The transfer to offload the sweetness enterprise is “positive, not only to improve the balance sheet, but also to focus on its core luxury brands,” Santander analyst Mariano Szachtman wrote.
Representatives for L’Oreal and Kering didn’t instantly reply to requests for remark. A Coty consultant declined to remark. The firms can even discover enterprise alternatives within the fields of luxury, wellness and longevity, they introduced.
Kering has struggled lately with slumping gross sales at its largest model, Gucci, and an rising debt load after a sequence of dear offers, together with Creed and premium property acquisitions. De Meo vowed final month to slash debt and prices.
L’Oreal, meantime, has been on an acquisition spree. It purchased Aēsop in 2023 at an enterprise worth of about $2.5 billion, and lately bought South Korean model Dr. G, a majority stake in Medik8, and minority stakes in Omani high-end perfume maker Amouage, French trend model Jacquemus, and Galderma Group AG, which specialises in injectable pores and skin fillers.
Some of these current purchases are half of L’Oreal’s rising luxury portfolio, which is overseen by Cyril Chapuy.
Investors are additionally ready for a decision as to who will purchase an preliminary 15% stake in Giorgio Armani SpA following the founder’s demise final month. L’Oreal, which has a license with Armani to market its perfume, make-up and skincare merchandise till 2050, was named as a one of the popular patrons in Giorgio Armani’s will together with EssilorLuxottica SA, one other license holder, in addition to LVMH Moët Hennessy Louis Vuitton SE.
On the Kering deal, L’Oreal was suggested by Bank of America, Rothschild and PVC PH. Villin Conseil. Kering was suggested by Centerview and Evercore.