L'Oréal has reached an agreement with Brazilian group Natura & Co to acquire Australian luxury brand Asop for an enterprise value of $2.52 billion, the two companies announced on Monday.

This transaction will enable the French giant to strengthen its presence in the luxury market, while it will provide Natura with a breath of fresh air at a time when the Brazilian group is plagued by debt and has seen its margins shrink.

In a press release, L'Oréal points out that Asop is distributed in some 400 exclusive outlets in America, Europe, Australia, New Zealand and Asia, with sales of $537 million last year - up 21% year-on-year at constant exchange rates.

"Asop is taking advantage of all current ascendant consumer trends, and L'Oréal will help accelerate its enormous growth potential, particularly in China and 'travel retail'," said L'Oréal CEO Nicolas Hieronimus in the release.

Natura, for its part, said the transaction would enable it to accelerate its debt reduction and refocus its strategy.

The Brazilian group specified that the operation should be finalized in the third quarter of 2023. (Peter Frontini reports from Sao Paulo, written by Jean Terzian)