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Kering Beauté is the new owner of high-end heritage fragrance house Creed, signalling the conglomerate’s push to grow its beauty presence.
On Monday, the group said it would acquire 100 per cent of the company from funds controlled by Blackrock Long Term Private Capital and current chairman Javier Ferrán. The terms of the deal were not disclosed. The all-cash transaction is expected to close in the second half of 2023, subject to clearance by relevant authorities.
Founded in 1760 by James Henry Creed, the luxury perfumer became known for harnessing sophisticated, unique and natural scents, such as its bestselling Aventus range, and serving the royal families of Europe. It was one of the largest remaining global independent players in the high-end fragrance market. The acquisition marks the first since French luxury conglomerate Kering created its new beauty division at the beginning of the year, and comes as the high-end luxury fragrance segment reports double-digit growth and high profitability, according to Kering’s statement, which called the deal a “major step” for Kering Beauté.
“The acquisition of Creed represents Kering Beauté’s first strategic initiative, and demonstrates our commitment to developing a strong position in the luxury beauty segment,” said Kering’s chairman and CEO François-Henri Pinault in the statement. “I am thrilled that today our stories and values come together around this spirit of family entrepreneurship and excellence to accelerate our journey in beauty, and I am delighted that the brand is joining Kering’s collection of luxury Houses.”
Kering Beauté plans to drive Creed’s growth across new geographical markets, channels and categories, notably through the acceleration of its development in China and in travel retail, as well as further expansion within its feminine fragrance portfolio and body and home categories. Meanwhile, Kering Beauté will gain access to its global distribution network, providing the luxury group with the required scale, financial profile and platform to support the future development of other fragrances with its franchise, it said.
Creed currently operates 36 branded stores and sells through 1,400 doors globally. In recent years, the business has delivered double-digit growth and “remarkable” profitability with “very high” EBITDA margins, while “never compromising on product quality or brand equity”, according to a release from Kering. For the full year ended 31 March 2023, Creed generated revenue of more than €250 million.
“Creed has a unique positioning in the fragrance market. We see a very compelling rationale and mutual strategic benefits in terms of expertise, network and geographical footprint. We look forward to working with CEO Sarah Rotheram and her passionate team to continue to drive Creed’s success worldwide,” said Kering Beauté CEO Raffaella Cornaggia in a statement. The former Estée Lauder executive was appointed in February to lead the group’s push into beauty.
The deal indicates continued interest in the high-end fragrance market; last May, Spanish fashion and perfume company Puig acquired Byredo in a deal reported to be worth €1 billion. Earlier this month, Vogue Business wrote that big luxury groups, including Kering and LVMH, were likely to compete more aggressively in the beauty market going forwards as strategic investments become a priority.
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