Kering Nears Deal to Sell Its Beauty Division to L’Oréal – Insider Reports (2025)
- Why Is Kering Selling Its Beauty Division?
- What’s in It for L'Oréal?
- How Might This Reshape the Beauty Landscape?
- Financial Implications and Market Reactions
- FAQs: Your Burning Questions Answered
In a move that’s sending ripples through the luxury and beauty sectors, French conglomerate Kering is reportedly finalizing the sale of its beauty division to industry giant L'Oréal. The deal, if confirmed, WOULD mark a significant shift in Kering’s strategy to streamline its portfolio. Sources close to the matter suggest negotiations are in the advanced stages, with an announcement expected imminently. Here’s a deep dive into what this means for both companies and the broader market.
Why Is Kering Selling Its Beauty Division?
Kering, best known for its luxury fashion houses like Gucci and Saint Laurent, has long struggled to make its beauty division as profitable as its Core businesses. Industry analysts (including our BTCC team) note that beauty requires a different operational scale—something L'Oréal has mastered. "Kering’s beauty arm lacked the R&D firepower and distribution muscle to compete," says a Paris-based luxury analyst. Selling to L'Oréal, which owns brands like Lancôme and Maybelline, could unlock synergies neither company could achieve alone.
What’s in It for L'Oréal?
L'Oréal’s potential acquisition aligns with its aggressive expansion into premium beauty segments. Kering’s portfolio includes niche perfumes and skincare lines that would complement L'Oréal’s existing luxury offerings. "This isn’t just about adding brands—it’s about acquiring a curated customer base," notes a TradingView market strategist. The deal could also help L'Oréal counter rival Estée Lauder’s recent gains in Europe.
How Might This Reshape the Beauty Landscape?
The beauty industry has seen consolidation accelerate post-pandemic, with big players swallowing smaller ones to dominate shelf space—both physical and digital. A Kering-L'Oréal deal would further tilt power toward conglomerates. Smaller indie brands might struggle to compete unless they niche down hard. Fun fact: This isn’t Kering’s first beauty rodeo—they sold Stella McCartney’s fragrance license to L'Oréal back in 2019. History repeating?
Financial Implications and Market Reactions
While terms remain undisclosed, estimates suggest a price tag north of €3 billion. Kering’s shares edged up 1.2% on rumors, while L'Oréal’s held steady—investors seem to view this as a "win-win." The transaction would free up capital for Kering to double down on its high-margin fashion labels, possibly funding another Gucci-level acquisition. "Beauty was always the odd one out in their portfolio," remarks a Bloomberg source.
FAQs: Your Burning Questions Answered
When will the deal be finalized?
Insiders suggest an official announcement could come as early as Q4 2025, pending regulatory approvals.
Which brands are included in the sale?
The entire Kering Beauté portfolio—primarily fragrance licenses for Balenciaga, Bottega Veneta, and Alexander McQueen.
Will this affect product availability?
Unlikely in the short term. L'Oréal typically maintains existing distribution while integrating supply chains.
