French luxury group Kering, owner of fashion brand Gucci, is moving closer to selling its beauty division to L’Oréal, according to two people familiar with the situation.
One of the sources confirmed that the deal would be worth about $4 billion, according to a report in the Wall Street Journal, which was first to report the development.
L’Oréal, the largest cosmetics and beauty company in the world, would acquire the Creed fragrance brand and gain the rights to develop beauty products linked to Kering’s fashion brands. This includes Bottega Veneta, Balenciaga and McQueen, the WSJ reported, adding that the deal could be announced next week.
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Controlled by the French Pinault family, Kering launched its beauty division in 2023, the year in which it acquired the high-quality fragrance brand Creed for 3.5 billion euros ($4 billion).
Kering declined to comment and L’Oréal did not immediately respond to a Reuters request for comment.
A sale would be an important step by new CEO Luca De Meo, who officially took office in September, to resolve the high debt problem that has caused investor anxiety.
Kering’s net debt was 9.5 billion euros at the end of June.
