L'Oreal and Gucci said they have reached a licensing agreement lasting 50 years for the French company to make perfumes and cosmetics under the name of the Italian fashion house, Gucci's parent company Kering said Tuesday. 

The agreement follows a decision to terminate a licence agreement between Gucci and US-based Coty a year before it was due to expire, Kering said in a statement. 

The licence agreement between Gucci and Coty – which will receive approximately $400 million in compensation – was due to expire in June 2028. The new licence agreement with L'Oreal is expected to come into force in mid-2027.

"By combining Gucci’s global desirability and distinctive creative vision with L’Oreal’s unparalleled expertise in beauty, innovation capabilities and worldwide distribution network, the partnership aims to unlock significant long-term growth opportunities across fragrance and beauty," Kering said.