LVMH Moët Hennessy Louis Vuitton, the world’s largest luxury-goods group, has acquired a large stake in Hermès International,
the
Wall Street Journal
reported.
LVMH said it acquired a 14.2% stake and owns derivatives that it can convert into nearly another 3% stake inn the French family-controlled fashion house, the article said.
The
Journal
report noted that “LVMH said it wouldn’t launch a takeover offer, try to control Hermès or ask for a board seat,” although the move raises questions about the giant conglomerate’s long-term intentions.
The report said that more than 200 fifth- and sixth-generation descendants of founder Thierry Hermès control 72% of the company; the rest is floated on the Paris stock exchange.
Since the death of former chief executive and family member Jean-Louis Dumas earlier this year, speculation has increased that some member of the family could sell their shares.
A follow-up
Journal
article
reported that Hermès released a statement saying:
“Non-solicited moves on the capital prompted the family to confirm its perfect unity and unanimous will to maintain control in the long term.”
That statement, the article said, “seemed to signal possible tensions between the two companies, which have long been rivals in the Parisian and global fashion world.”
The report noted that LVMH chairman Bernard Arnault has “made a name for himself as a corporate raider by preying on smaller family-owned firms.”
(Source:
Wall Street Journal,
Oct. 25, 2010 and Oct. 26, 2010.)
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