LVMH increases its stake in Hermès through additional share purchases
In a significant move to protect its independence, luxury goods conglomerate Hermès has announced the creation of a holding company. This defensive measure comes in response to LVMH's recent increase in its stake in Hermès.
According to reports, the Hermès family made the announcement yesterday, and the holding company will allow them to have significant control over more than 50% of their company's capital. This move is seen as a crucial step in the ongoing relationship between the two luxury groups.
On December 15, LVMH, led by Bernard Arnault, the chairman and CEO, increased its stake in Hermès from 21.4% to 22.3%. This information was released by the Autorité des Marchés Financiers (AMF), the French equivalent of the National Securities Market Commission (CNMV), today.
In response to Hermès's announcement, LVMH responded within a day, reiterating that it has no intention of buying Hermès. The AMF's statement from LVMH also included a clarification that the group has not ruled out acquiring more shares in Hermès, depending on market conditions and circumstances.
The creation of the holding company by Hermès is a strategic move to prevent a possible takeover by LVMH. Hermès aims to maintain its unique identity and independence in the highly competitive luxury goods market.
The AMF, the regulatory body responsible for overseeing the French stock market, has been closely monitoring the developments between Hermès and LVMH. The AMF released a statement from LVMH today, confirming the group's intentions regarding Hermès.
This news comes as a reminder of the complex dynamics in the luxury goods industry, where competition for market share and brand dominance can lead to strategic moves such as the creation of holding companies and the acquisition of stakes in competing companies. As the situation continues to unfold, both Hermès and LVMH will undoubtedly be under close scrutiny from industry watchers and investors alike.
