Core Viewpoint - Kering Group and L'Oréal Group have announced a long-term strategic partnership in the luxury beauty and health sector, with a total deal value of €4 billion (approximately ¥332 billion), marking the largest acquisition in the beauty sector this year [4][11]. Group 1: Details of the Agreement - The agreement consists of three main parts: Kering will sell its beauty business, including the Creed brand, to L'Oréal, along with a 50-year licensing agreement for Kering's iconic perfume brands [9][10]. - Creed, a historic perfume brand founded in 1760, was acquired by Kering for €3.5 billion just four months prior to this deal, indicating a rapid change in ownership [9][12]. - L'Oréal will also receive exclusive rights for the development, production, and distribution of Gucci's beauty products, as well as a 50-year exclusive license for the creation and distribution of Bottega Veneta and Balenciaga's beauty products [10][11]. Group 2: Strategic Implications - This partnership reflects Kering's need to alleviate financial pressure and focus on its core business, as the company faces declining revenue and a significant net profit drop of 62% [11][12]. - L'Oréal's aggressive expansion strategy is highlighted by this acquisition, positioning the company as a major player in the rapidly growing high-end perfume market [13][14]. - The collaboration will also explore business opportunities at the intersection of luxury goods, health, and longevity, with plans to establish a 50-50 joint venture [11][12]. Group 3: Market Context - L'Oréal has been actively acquiring brands to strengthen its position in the beauty market, including recent acquisitions of luxury brands and investments in emerging markets [13][14]. - The company has a history of building its empire through strategic acquisitions, with a diverse portfolio of over 50 brands across various beauty segments [15].