Gucci Beauty Transfer
Kering Pays Coty $400 Million for Gucci Beauty License Return, Accelerating L'Oréal Deal
Anonymous
Key Points
1
Kering is paying Coty to keep L’Oréal happy as part of the Gucci Beauty license handover, highlighting coordinated moves between the luxury players during the transition.
2
Coty will incur about $30 million in cash taxes related to the deal, in addition to selling existing Gucci Beauty inventory to Kering.
3
Coty claims it grew Gucci Beauty revenue by more than 60% since 2019, underscoring the value created under Coty’s management of the brand.
4
Nicolas Hieronimus of L’Oréal described Gucci Beauty as a significant growth engine for L’Oréal Luxe, with the Gucci 50-year license now set to begin on July 1, 2027 (accelerated, pending regulatory approvals).
Coty is handing the Gucci Beauty license back to Kering in a deal worth roughly $400 million, ending a decade-long partnership ahead of schedule. Drugstore News reported that Coty will keep running the brand until at least June 30, 2027, ensuring a smooth handover before exiting the business entirely.
The deal opens the door for L'Oréal to take over Gucci Beauty earlier than planned. L'Oréal CEO Nicolas Hieronimus called Gucci Beauty a "significant growth engine" for L'Oréal Luxe, with the brand's 50-year licensing agreement now set to begin July 1, 2027 — one year ahead of the original timeline — pending regulatory approvals, according to Personal Care Insights.
How the $400 Million Deal Breaks Down
Kering will pay Coty $250 million upfront. An additional $150 million is due by September 2027. On top of that, Coty can earn up to $30 million in incentive payments. Coty will also sell its existing Gucci Beauty inventory to Kering as part of the transition, according to HAPPI.
The deal is not without costs for Coty. The company will owe about $30 million in cash taxes tied to the transaction. Still, Coty plans to use the proceeds to pay down debt and invest in its core prestige brands as it restructures to boost profitability. The agreement also resolves pending litigation between the two companies.
Coty Grew Gucci Beauty 60% — Then Sold the License
Coty has managed Gucci Beauty since around 2019. The company says it grew Gucci Beauty revenue by more than 60% during that time. That growth made the license more valuable — and gave Coty something worth selling. Analysts see the deal as Coty cashing out on value it helped build, according to Personal Care Insights.
The sale fits a broader shift at Coty. The company is going through a leadership transition and refocusing on its strongest brands. Letting go of Gucci Beauty frees up capital and cuts complexity. It signals that Coty would rather own fewer, stronger assets than manage a wide portfolio of licensed brands.
L'Oréal Lands a Luxury Prize One Year Early
L'Oréal already had a deal to take over the Gucci Beauty license — but not until June 30, 2028. This new agreement moves that date up by a full year to July 1, 2027. That earlier start gives L'Oréal more time inside what Hieronimus called a key growth driver for L'Oréal Luxe, as reported by Personal Care Insights.
Kering played a key coordinating role. The luxury group is essentially paying Coty to keep L'Oréal happy and make the early handover work. All three companies — Coty, Kering, and L'Oréal — had to align on timing, inventory, and transition terms. Regulatory approval is still needed before the L'Oréal deal can officially begin, according to Morningstar.
A Reshuffled Luxury Beauty Landscape Going Into 2027
The deal reshapes who controls what in prestige beauty. Kering reclaims Gucci Beauty after years of licensing it out. L'Oréal adds a major luxury brand to its already large portfolio. And Coty steps back from a brand it helped grow, using the exit to clean up its balance sheet and sharpen its focus.
The transition period runs through at least mid-2027, giving all sides time to manage inventory, staff, and operations. By the time L'Oréal fully takes over, Gucci Beauty will have passed through three stewards in under a decade. The moves reflect how fast licensing deals — and strategic priorities — can shift in the global beauty industry.
Sentiment
Mostly PositiveNEGATIVENEUTRALPOSITIVE
Publishers
14
Articles
77
Reach
91
A
AnonymousAuthor
