Kering Beauté Acquires High-End Luxury Heritage Fragrance House

Kering Beauté Is The New Owner Of The Largest global independent player in the fast-growing high-end luxury fragrance segment.

Established in 1760 by James Henry Creed, the House of Creed is the largest global independent player in the high-end fragrance market. Creed possesses a distinct collection of timeless and sophisticated perfumes, including the iconic Aventus.

Creed Fragrances, the high-end luxury heritage fragrance house, has found a new owner in Kering Beauté, marking a significant move in the luxury beauty segment. Kering Beauté, a subsidiary of the Kering Luxury Group, has acquired 100% of Creed from funds controlled by BlackRock Long Term Private Capital Europe and current Chairman Javier Ferrán. This acquisition positions Kering Beauté as a major player in the high-end fragrance market and sets the stage for future expansion and growth.

Founded in 1760 by James Henry Creed, the House of Creed has a rich history and is known for its timeless and sophisticated perfumes. The brand’s collection includes the iconic fragrance Aventus, which has gained global recognition and acclaim. With its acquisition of Creed, Kering Beauté gains immediate scale and a strong financial profile, complementing its existing portfolio of renowned luxury brands.

The strategic importance of this move for Kering Beauté cannot be overstated.

It provides the company with a solid foundation for future growth and development in the fragrance market. By leveraging Creed’s global distribution network, Kering Beauté can expand its own fragrance franchises and strengthen its position in the luxury beauty segment. This acquisition aligns with Kering’s overall strategy of expanding its presence in the beauty category, which is a natural extension of its luxury universe.

While Kering Beauté intends to preserve Creed’s rich heritage and high-end brand image, it also aims to unlock the brand’s potential across different geographies, channels, and product categories. This includes accelerating Creed’s development in China and the Travel Retail sector, as well as expanding its feminine fragrance portfolio and venturing into body and home categories. These strategic moves will help Creed reach new audiences and further establish its position as a global leader in luxury fragrances.

The luxury fragrance segment is experiencing strong market dynamics, with double-digit growth, high profitability, and significant revenue recurrence.

This sector offers long-term resilience through economic cycles, making it an attractive investment for Kering Beauté. The acquisition of Creed aligns with Kering’s vision of creating lasting value for the group and its luxury houses by expanding into strategic segments such as beauty.

The transaction is expected to be an all-cash deal and is set to close in the second half of 2023, subject to clearance by the relevant competition authorities. François-Henri Pinault, Chairman and Chief Executive Officer of Kering, expressed his excitement about the acquisition, highlighting the alignment of values and the opportunity to accelerate Kering’s journey in beauty. Jean-François Palus, Group Managing Director of Kering, emphasized Creed’s exclusivity and creativity, emphasizing the belief in the brand’s potential to facilitate and amplify Kering Beauté’s development in fragrance.

Raffaella Cornaggia, CEO of Kering Beauté, sees a compelling rationale and mutual strategic benefits in the acquisition. She looks forward to working with CEO Sarah Rotheram and the passionate team at Creed to drive the brand’s success worldwide. This sentiment is echoed by André Bourbonnais, Global Head of Long Term Private Capital at BlackRock, who believes Kering is the right home for the unique heritage brand and is confident that it will thrive under their stewardship.

Creed’s commitment to excellence and craftsmanship has made it one of the most prestigious fragrance houses in the world. The brand’s dedication to sourcing and using the finest natural raw ingredients sets it apart from competitors. Through its “Fragrance for the Future” framework, Creed ensures sustainable production methods in its laboratory in Fontainebleau, France. With a network of 36 branded stores and distribution through approximately 1,400 doors globally, Creed offers an elevated in-store experience and wide accessibility for fragrance enthusiasts.

In recent years, Creed has achieved impressive growth and remarkable profitability, maintaining high EBITDA margins while upholding product quality and brand equity.

In the fiscal year ending on March 31, 2023, Creed generated revenue exceeding €250 million. This strong financial performance underscores the brand’s market position and its potential for further expansion under Kering Beauté’s ownership.

The acquisition of Creed by Kering Beauté marks an exciting development in the luxury beauty segment. With its established heritage, commitment to craftsmanship, and global reputation, Creed is a valuable addition to Kering’s collection of luxury houses. This strategic move positions Kering Beauté as a major player in the high-end fragrance market, with ample opportunities for growth and expansion in the future.