Following the appointment of Raffaella Cornaggia as CEO of Kering Beauté, the luxury conglomerate has made its first big move in beauty, acquiring 100% of the niche fragrance brand Creed in an all-cash transaction.
WHO: Creed was established in 1760 by James Henry Creed first as a tailoring house, and later as a fragrance house, producing more than 200 perfumes, including the cult fragrance Aventus, Viking, Himalaya, and Green Irish Tweed. Based in Paris, with a factory in nearby Fontainebleau, Creed manufactures many of its own essences using a traditional infusion technique that enables Creed to maintain the quality and authenticity of its fragrances. Creed currently operates 36 branded stores and sells through 1,400 doors globally.
A global luxury group, Kering manages the development of a series of renowned houses in fashion, leather goods and jewelry: Gucci, Saint Laurent, Bottega Veneta, Balenciaga, Alexander McQueen, Brioni, Boucheron, Pomellato, DoDo, Qeelin, as well as Kering Eyewear and Kering Beauté. Kering announced early this year that it was creating an in-house beauty division.
WHY: The acquisition of Creed is a major step for Kering Beauté and a perfect fit with its portfolio of luxury brands. The transaction immediately provides the required scale, an outstanding financial profile, as well as a platform that will support the future development of other Kering Beauté fragrance franchises by leveraging Creed’s global distribution network. Kering Beauté will further unlock Creed’s potential across geographies, channels, and categories, notably through accelerating its development in China and travel retail and expanding the feminine fragrance portfolio and body and home categories.
IN THEIR OWN WORDS: François-Henri Pinault, Chairman and Chief Executive Officer of Kering, commented, “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. 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.”
Jean-François Palus, Group Managing Director of Kering, declared, “The House of Creed is recognized as one of the few leading global luxury fragrance brands, synonymous with exclusivity and creativity. We are confident that this landmark acquisition will facilitate and amplify our development in fragrance. This is a milestone in the development of Kering Beauté, as we believe more than ever in the strong potential of our brands in beauty.”
Raffaella Cornaggia, CEO of Kering Beauté, highlighted, “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.”
André Bourbonnais, Global Head of Long Term Private Capital at BlackRock, said, “We are pleased and honored to have partnered with the Creed family and Creed Executive Chairman and BlackRock LTPC Operating Partner, Javier Ferrán, who has been critically important in the sourcing of and value creation for Creed. Our partnership has helped us to further grow this world-class business through geographic and channel expansion, new product development and a focused marketing strategy. This transaction is highly emblematic of BlackRock LTPC’s strategy of investing in high-quality companies and actively collaborating with management teams to create value.”
Dag Skattum, Head of European Office of Long Term Private Capital at BlackRock, said, “It has been a privilege to build on the Creed family legacy and to have partnered with such a dedicated and talented management team, led by CEO Sarah Rotheram, to further strengthen Creed’s iconic standing. We are confident that Kering is the right home for such a unique heritage brand, and that it will continue to thrive under their stewardship.”
TRIBE DYNAMICS EMV: Creed made headlines late in Q2, when the cult-favorite luxury fragrance brand was acquired by Kering Beauté. While many of Creed’s top-earning posts from Q2 mentioned the blockbuster deal, the brand was well on its way to a healthy quarter even before news broke in the waning days of June. Creed partners like Léanne Ansar (@leanneansar on Instagram) shared promotional posts hyping the brand’s Spring Flower fragrance, with the bulk of this content coming in May. Thanks to this campaign, #CreedSpringFlower garnered $193.2K EMV from 23 creators as Creed’s top Q2 hashtag. The brand itself netted $2.6MM EMV, a 26% QoQ improvement.
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