L’Oréal is moving toward a potential acquisition of Armani Beauty, positioning itself to turn one of its most important luxury licences into a fully owned brand as the late Giorgio Armani’s succession plan begins to play out. The move comes as the designer’s will triggers a phased sale of the Armani empire, with beauty emerging as one of the most strategically coveted assets.
From a long-term licence to possible ownership
Today, L’Oréal already holds a licence running until 2050 to develop Armani fragrances, skincare and make-up, making the brand a cornerstone of L’Oréal Luxe. Analysts estimate Armani Beauty generated around €1.5 billion in sales in 2023, roughly 10% of the division and 3.45% of total group revenue.
Under the will, heirs must sell an initial 15% stake in Giorgio Armani SpA within 18 months, with the option to raise that holding to a majority over the following years. L’Oréal, LVMH, and EssilorLuxottica have been named as preferred buyers, but reporting indicates L’Oréal’s interest is focused squarely on the profitable beauty arm rather than the wider fashion, home, and accessories businesses.
“Very soon”: the deal work is starting
Speaking in a recent fireside chat with analysts, L’Oréal CFO Christophe Babule said the group will “definitely” look at an investment in Armani and start working on it “very soon”. He said the company is “quite honoured by the consideration of the heirs of the family towards their willingness to see L’Oréal investing in their company.”
Any stake would come on top of L’Oréal’s existing beauty licence and follow its recent €4 billion deal with Kering to acquire that group’s beauty business, including Creed and long-term licences for Gucci, Bottega Veneta, and Balenciaga. Babule said the Kering transaction “will not prevent L’Oréal from going further if we have good opportunities,” signalling that balance sheet capacity remains available for a potential Armani move.
Why Armani Beauty is the prize
For L’Oréal, converting Armani Beauty from a licence to ownership would secure a powerful revenue driver and remove long-term uncertainty around rights renewal. It would also mirror sector moves such as Estée Lauder’s full acquisition of Tom Ford, tightening control over a top-performing luxury brand at a time when designer fragrances and premium make-up are a key growth engine.
By contrast, the broader Armani fashion and lifestyle empire is seen as a better fit for players like LVMH or EssilorLuxottica, whose strategies encompass ready-to-wear, accessories and eyewear. A split outcome, where different buyers take different parts of the group, is viewed as increasingly likely, with beauty remaining at the heart of L’Oréal’s interest.
What’s next for prestige beauty M&A
If L’Oréal ultimately secures Armani Beauty, it would strengthen L’Oréal Luxe’s hold on prestige fragrance and make-up at a time when licensed designer brands continue to post strong sales and drive category visibility worldwide. It would also deepen an already decades-long collaboration between L’Oréal and Armani, first established in 1988, and reinforce a broader industry trend of beauty groups converting high-performing licences into owned brands where possible.
For now, the process remains at the evaluation stage, guided by the timetable and structure laid out in Giorgio Armani’s will. But the message from L’Oréal’s leadership is clear: the group is preparing to move, and prestige beauty M&A is set for another defining chapter if an Armani deal goes ahead.
